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Last Updated : Jan 14, 2015 10:39 AM IST | Source:

8 Tata cos' mcap < Motherson: Decoding Tata Grp's skewness

The market capitalization of eight of the Tata Group‘s smallest listed firms combined shows it is smaller than that of automotive products‘ manufacturer Motherson Sumi.

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Moneycontrol Bureau

It’s a trivia that may perhaps surprise even keen followers of the stock market: a glance at the market capitalization of eight of the Tata Group’s smallest listed firms combined shows it is smaller than that of automotive products’ manufacturer Motherson Sumi.

According to latest trading values, the total market cap of eight Tata firms: Tata Metaliks, Tata Sponge Iron, Tata Teleservices Maharastra, Tata Coffee, Tata Elxsi, Indian Hotels, Tata Global Beverages and Tata Chemicals amounts to a total of Rs 37,487 crore. That’s lesser than Motherson Sumi’s total market cap of Rs 39,165 crore. (See infographic below.)


Another discerning aspect of the above point is the earnings capability of these firms and the dependence of the Tata Group on others: cumulatively, these firms notched up a loss of Rs 1,083 crore on revenues of Rs 33,474 crore in fiscal year 2014 (thanks largely to losses at Indian Hotels, Tata Chemicals and Tata Tele), compared to Rs 1,096 crore net profit notched up by Motherson Sumi on sales of Rs 31,042 crore. (Note: an earlier version of this article erroneously calculated financials for the Tata firms. The error is regretted.)

The above statistic also highlights the skewness in terms of the wealth creation abilities of the salt-to-software conglomerate, with three firms (Tata Communications at Rs 12,132 crore, Tata Power at Rs 21,406 crore and Tata Steel at Rs 38,114 crore) having notched up a sizeable valuation while only two others (Tata Motors at Rs 1.66 lakh crore and TCS at Rs 4.86 lakh crore) can qualify as truly giant marketcap.

Among the entire Tata pack, TCS’ valuation is bigger than the combined value of all the remaining listed group firms (Rs 2.75 lakh crore).

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First Published on Jan 13, 2015 04:12 pm
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