Tata Motors – Financial history and Dividend policy

Goa Institute of Management

PGP1 2010-11

3 / 2 / 2 0 1 1

Submitted by:Group 3

Section C

Alok Jaiswal (2010124)Deepika Kaur (2010133)

Dushyant Bhadauria (2010134)Madhumitha J (2010147)

Praveen Trivedi (2010156)

1 | T a t a M o t o r s - F i n a n c i a l h i s t o r y

ContentsTATA MOTORS – FINANCIAL HISTORY..................................................................................................1

AUTOMOBILE INDUSTRY IN INDIA.........................................................................................................1

BACKGROUND OF TATA MOTORS...........................................................................................................2

Acquisitions.................................................................................................................................................3

Tata Motors - Product Portfolio....................................................................................................................3

Tata Motors - 2010 Market Performance......................................................................................................4

Tata Motors Technology and Design Subsidiaries........................................................................................5

TATA MOTORS DIVIDEND POLICY.....................................................................................................................5

Rights Issue...................................................................................................................................................6

Rights Issue in 2001..................................................................................................................................6

Rights Issue in 2008..................................................................................................................................7

2001- 2002 Crisis..........................................................................................................................................7

2008 - 2009 Crisis.........................................................................................................................................8

FIGURES..........................................................................................................................................................10

Figure 1: Dividend and stock price snapshot of Tata Motors of last 10 years.........................................10

Figure 2: PAT, Retained Earnings and equity dividend snapshot of Tata Motors of last 10 years..........10

Figure 3: Vehicle Production in India......................................................................................................11

EXHIBITS.....................................................................................................................................................12

Exhibit 1: Dividend payout history of Tata Motors.................................................................................12

Exhibit 2: Bonus announcement history of Tata motors........................................................................12

Exhibit 3: Ratios......................................................................................................................................13

Exhibit 4: ONW, ROCE, Quick Ratio , Current Ratio and Interest cover of Tata Motors..........................15

Exhibit 5: Cash flow................................................................................................................................15

Exhibit 6: Balance sheet..........................................................................................................................16

Exhibit 7: Annual results (in brief)..........................................................................................................17

Exhibit 8: Share holding..........................................................................................................................18

Exhibit 9: Financial data of Tata motors about earing and dividend per share.......................................19

Exhibit 10: Capital Structure of Tata Motors..........................................................................................21

REFERENCES...............................................................................................................................................23

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1 | T a t a M o t o r s - F i n a n c i a l h i s t o r y

TATA MOTORS – FINANCIAL HISTORY

Tata Motors Limited is India's largest automobile company, with consolidated revenues of Rs.

92,519 crores (USD 20 billion) in 2009-10. It is the leader in commercial vehicles in each segment,

and among the top three in passenger vehicles with winning products in the compact, midsize car

and utility vehicle segments. The Company's 24,000 employees are guided by the vision to be "best

in the manner in which we operate, best in the products we deliver and best in our value system and

ethics."

“There is great confidence that with the major initiatives undertaken in terms of global acquisitions, product development, new product introductions and operational synergies, Tata

Motors will achieve growth and take its place as a respected and viable automobile enterprise in the global industry with meaningful size and scale in the various segments in which it operates. The

progress which the Company has made would never have been possible without the tremendous support of our management, our workforce and our unions. We also appreciate the confidence and loyalty displayed by our customers, whom we will always strive to serve better. Last, but not least, we wish to thank our shareholders for their continued faith and support to the Company through

good times and bad. All of this has gone towards making Tata Motors the company it is today. We would need this continued support to achieve the goals we have set for Tata Motors in the years

ahead.” -- Chairman, Tata Motors, Mumbai, July 16, 2010

AUTOMOBILE INDUSTRY IN INDIA

The Automotive industry in India is one of the largest in the world and one of the fastest growing

globally. India manufactures over 11 million vehicles (including 2 wheeled and 4 wheeled) and

exports about 1.5 million every year. It is the world's second largest manufacturer of motorcycles,

with annual sales exceeding 8.5 million in 2009. India's passenger car and commercial vehicle

manufacturing industry is the seventh largest in the world, with an annual production of more than

2.6 million units in 2009. In 2009, India emerged as Asia's fourth largest exporter of passenger cars,

behind Japan, South Korea and Thailand.

As of 2009, India is home to 40 million passenger vehicles and more than 2.6 million cars were sold

in India in 2009 (an increase of 26%), making the country the second fastest growing automobile

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market in the world. According to the Society of Indian Automobile Manufacturers, annual car

sales are projected to increase up to 5 million vehicles by 2015 and more than 9 million by 2020.

By 2050, the country is expected to top the world in car volumes with approximately 611 million

vehicles on the nation's roads. (See figure 3)

A chunk of India's car manufacturing industry is based in and around the city of Chennai, also

known as the "Detroit of India" [With the Indian city accounting for 60 per cent of the country's

automotive exports]. Gurgaon and Manesar near New Delhi are hubs where all of the Maruti Suzuki

cars in India are manufactured. The Chakan corridor near Pune, Maharashtra is another vehicular

production hub with companies like General Motors, Volkswagen, Skoda, Mahindra and Mahindra,

Tata Motors, Mercedes Benz, Fiat, Force Motors. Ahmedabad with Tata Motors Nano plant and

Halol with General Motors in Gujarat, Aurangabad in Maharashtra, and Kolkata in West Bengal are

some of the other automotive manufacturing regions around the country.

BACKGROUND OF TATA MOTORS

Tata Motors Limited (Tata Motors) is an automobile company. The Company is engaged mainly in

the business of automobile products consisting of all types of commercial and passenger vehicles,

including financing of the vehicles sold by the Company. The Company has two segments:

automotive and others. The others segment includes construction equipment, engineering solutions

and software operations.

Instigated in the year 1945, Tata Motors has a wide network of retailers and suppliers across India.

It was in 1954 that the company launched its first vehicle. Today more than 3 million Tata cars and

heavy vehicles glide through Indian roads. The company gained the prestige of being the first from

engineering industry of India to be listed under the New York Stock Exchange in September 2004.

Besides being second biggest in the passenger car division, Tata Motors is also ranked as fifth

highest in the category of medium and heavy commercial vehicles at international level. With the

help of its associates, Tata Motors offer high end manufacturing and automotive solutions to its

customers. It's foremost indigenously made car was Tata Indica, followed by a mini-truck Tata Ace

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in 2005. In the year 2009, the firm marked its name in the pages of automotive history by

introducing the world's fuel efficient and cheapest car - Tata Nano.

Acquisitions

Tata Motors, the first Company from India's engineering sector to be listed in the New York Stock

Exchange (September 2004), has also emerged as an international automobile company. Tata

Motors has operations in the United Kingdom, South Korea, Thailand and Spain. In 2004 Tata

Motors acquired Daewoo's truck manufacturing unit, now known as Tata Daewoo Commercial

Vehicle, in South Korea. In 2005, Tata Motors acquired 21% of Aragonese Hispano Carrocera

giving it controlling rights of the company. Then in 2007, Tata Motors formed a joint venture with

Marcopolo of Brazil and introduced low-floor buses in the Indian Market. The biggest acquisitions

happened in 2008, when Tata Motors acquired British Jaguar Land Rover (JLR), which includes the

Daimler and Lanchester brand names. On October 16, 2009, the Company has acquired 79% shares

in Tata Hispano Motors Carrocera S.A. by way of exercise of the existing call option, through

mutual agreement with the other share-holder, Investalia S.A., Spain. Consequently, Tata Hispano

Motors Carrocera S.A. has become a 100% subsidiary of the Company. In 2010, Tata Motors

acquired 80% stake in Italy-based design and engineering company Trilix for a consideration of

€1.85 million. The acquisition is in line with the company’s objective to enhance its styling/design

capabilities to global standards.

Tata Motors - Product Portfolio

Tata Indica - First locally made passenger car, Tata Indica is a compact rear door car that attracted

the attention of the people within the months of its launch. Spacious, comfortable and reasonably

priced, Indica is perfect for Indian roads and families. Tata Sumo Victa - Introduced in 2004, Tata

Sumo Victa is an MUV equipped with spacious interiors, burly appeal and an exclusively designed

cockpit. With 4.9m of rotating radius, coercing Victa through packed Indian roads is never an issue.

Indica V2 Xeta - Designed for urban Indian middle class it boasts of its competitive cost and

functionality. At the hatch back it can comfortable hold three people and two in the front seat. Tata

Indigo - India's first luxury sedan, Tata Indigo is equipped with hi-tech features and stylish design.

Competitively valued, the car is highly admired by Indian customers. Tata Indigo Marina - Tata

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Indigo Marina is the station car adaptation of their renowned model Indica and takes pride of its

opulence, roomy interiors that of an MUV and superb performance. Tata Safari - Perfect for off-

road drive, Tata Safari is Tata motors first sports utility vehicle (SUV). Adorned with powerful

engine, sporty appeal and excellent performance, Safari is preferred by Indian car enthusiasts. Tata

Indigo SX - Introduced in the year 2005, Tata Indigo SX is renowned for its chic and panache. It is

widely admired by the end users and keeping the Indian roads in mind. Tata Motors’ latest launches

are Tata Manza, Tata Land Rover, Tata Jaguar, Indica Vista, Tata Indica Dicor.

Table 1: Major Policy Initiatives for the Automotive Industry after 1991

Tata Motors - 2010 Market Performance

The FY 2009-10 witnessed the highest sale of Tata Motors vehicles registering at 642,686 units. In

March 2010, Tata Motors' total sales were recorded at 75,151 against 54,452 units vended in March

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2009. Collective sales of Tata Motors commercial vehicles in the Indian market for 2010 are

373,615 units. The company registered a growth of 41% considering its previous year's sales while

the collective sales of Tata Motors passenger vehicles for 2010 are 234,930 units and are estimated

the highest ever for the firm. The firm's trade from exports for March 2010 was at 4,105 units

against 1,799 units in the previous fiscal.

Tata Motors Technology and Design Subsidiaries

Tata Motors has dozens of technology and design subsidiaries. These include the main ones. Telco

Construction Equipment (TELCON) - TELCON is a joint venture between Tata Motors and

Hitachi, which focuses on excavators and other construction equipment. HV Transmission (HVTL)

and HV Axles (HVAL) - HVAL and HVTL are 85% subsidiary companies of Tata Motors engaged

in the business of manufacture of gear boxes and axles for heavy and medium commercial vehicles,

with production facilities and infrastructure based at Jamshedpur.

Tata Technologies Limited (TTL) - TTL provides Engineering and Design (E&D) solutions to the

Automotive Industry. Tata Motors holds 86.91% of TTL’s share capital. TTL is based in Pune

(Hinjawadi) and operates in the US and Europe through its wholly owned subsidiaries in Detroit

and London respectively. It also has a presence in Thailand. It bought over the British engineering

and design services company, Incat International Plc for Rs 4 billion in August 2005. Incat

specializes in engineering & design services and product lifecycle management in the international

automotive, aerospace and engineering markets. With this acquisition, Tata Motors will have closer

proximity to its global customers and be able to provide a wider range of services. Tata Motor

European Technical Centre - Tata Motor European Technical Centre is Tata's subsidiary based in

the UK. It was the joint developer of the World Truck.

TATA MOTORS DIVIDEND POLICY

TATA motors has a very balanced dividend policy since 1955 (Exhibit 1 & 9). In all, but two years

the company has paid a healthy dividend. Dividend smoothing has enabled the company so pay

dividend even at the cost of negative retained earnings. Despite being a growth company expanding

in new sectors the company has continued to strike a balance between retained earnings and

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dividend payouts. In times when the company has been in crisis they have looked at others

measures of satisfying the needs for liquidity for shareholders like issue of Bonus shares.

Automobile market is cyclic and the effect can be seen in the earnings of TML as well. Whenever

the profits of the company have exceeded expectations, the company has declared an interim

dividend while continuing with the existing payout ratio for regular dividends. Outside India the

company is also listed on the NYSE. The dividend policy of TML has helped build a special

relationship with retail customers who comprise more than 7 percent of the shareholders.

Rights Issue

A rights issue is a way in which a company can sell new shares in order to raise capital. Shares are

offered to existing shareholders in proportion to their current shareholding, respecting their pre-

emption rights. The price at which the shares are offered is usually at a discount to the current share

price, which gives investors an incentive to buy the new shares — if they do not, the value of their

holding is diluted.

A rights issue by a highly geared company intended to strengthen its balance sheet is often a bad

sign. Profits are already low (or negative) and future profits are diluted. Unless the underlying

business is improved, changing its capital structure achieves little. A rights issue to fund expansion

can usually be regarded somewhat more optimistically, although, as with acquisitions, shareholders

should be suspicious because management may be empire-building at their expense (the

usual agency problem with expansion). The rights are normally a tradable security themselves (a

type of short dated warrant). This allows shareholders who do not wish to purchase new shares to

sell the rights to someone who does. Whoever holds a right can choose to buy a new share

(exercise the right) by a certain date at a set price.

Rights Issue in 2001

The Board of Directors of approved the simultaneous Issue of Convertible Debentures and Non-

Convertible Debentures with Detachable Warrants on a rights basis in the ratio of one CD and one

NCD for every five shares (1:5) of the Company held. The Company expected to raise

approximately Rs. 1,228 crores - Rs. 1,382 crores from the proposed rights issue. The proceeds of

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the rights issue was planned to be used for essential capital expenditure and new product

development programs and repayment/ prepayment of expensive borrowings of the Company. The

infusion of long term funds, by way of this rights issue, was expected improve the cash flows and

the debt equity ratio.

Rights Issue in 2008

In May 2008 the company announced its long term financing plan for Jaguar-Land Rover

acquisition. At that time, the Company had announced that a part of the total funds required would

be raised through a Rights Issue to the shareholders of three simultaneous but unlinked securities

namely a) an issue of Ordinary Shares of a total amount of about Rs.2,200 crores; b) an issue of ‘A’

Ordinary Shares having differential voting rights (viz. 1 vote for every 10 shares held) of a total

amount of about Rs.2,000 crores and c) an issue of 0.5% 5-year Convertible Preference Shares of a

total amount of about Rs.3,000 crores, which would be convertible into ‘A’ Ordinary Shares at any

time after 3 years but before 5 years from the date of allotment.

Changes in Capital Market and the level of prices in the stock markets led the Board of Directors to

decide to keep the increase in Share Capital as low as possible, the Board decided -

1.To restrict the Rights Issue only to two simultaneous but unlinked securities namely – (a) an issue

of Ordinary Shares and (b) an issue of ‘A’ Ordinary Shares having differential voting rights, as

already announced; and 2. In place of the issue of Convertible Preference Shares, it is now proposed

to raise the required resources by monetizing a part of the Company’s investments through a phased

divestment of certain investments (preferably as inter-group sales wherever feasible) at prevailing

market prices over the next 6 to 8 months. The funds released from such future divestments

together with those already sold during the current financial year, will form part of the resources to

be raised for repaying the bridging loan taken for the Jaguar-Land Rover acquisition.

2001- 2002 Crisis

Ten years ago, after a decade of strong revenue and margin growth, Tata Motors plunged into an

crisis when the demand for its trucks suddenly collapsed. The lost sales compounded by heavy

investment for its entry into the passenger car business, the cost of complying with new emissions

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standards, and an increasing threat from overseas competitors caused Tata Motors to shock the

markets with a loss of Rs. 500 crores for the fiscal year ending March 2001. During this period for

the first time since 1956 Tata motors didn't declare a dividend. Average share price of TML

dropped from Rs. 217 in 1999-2000 to Rs. 102 in 2001-02.

Over the next two years, the company shaved around 8 billion rupees from its cost base and nursed

itself back to corporate health. The company count not show positive figures for PAT in 2001-02

and didn't declare a dividend in that year. Average share prices fell to Rs 90 in 2001-02Today Tata

Motors ranks as the world's fifth-largest manufacturer of medium and heavy trucks. Even while

keeping a tight grip on costs, Tata Motors moved to the offensive by refocusing its investments on

less cyclical products, including light commercial vehicles, buses, and spare parts; making a

successful entry into passenger cars; and responding to opportunities presented by favourable social

and economic trends.

2008 - 2009 Crisis

TM’s original core business in the passenger car division (small cars in India) was mildly

influenced by the crisis as TM’s passenger car sales decreased by only 5%. The company was much

more negatively affected by the decline in sales of its commercial vehicle division which

represented – not yet taking into account the JLR acquisition – some 2/3 of its turnover. However,

the financial crisis had a much more serious impact [in the last quarter of 2008 and the first quarters

of 2009] because of the ‘burden’ of two major strategic initiatives. The shift of the production site

and postponement of the full Nano launch which was originally scheduled for launch in March

2008 by two years led to unexpected resource needs (new manufacturing site) and a shortfall of

otherwise expected 2008-09 revenues. While this burden was not caused or much exacerbated by

the crisis in the global car industry, the acquisition of JLR only few months before the onset of the

crisis actually affected TM much more: the dramatic decrease in JLR’s

sales (JLR being fully exposed to European and US markets) significantly increased the heavy

losses of the new combined company in FY 2008/09; even more importantly, the refinancing of the

short term bridging loan of $ 3 billion for the acquisition became much more complicated and

costly in a situation of dried up capital markets. The refinancing difficulties and increasing

financing cost contributed to a serious debt overload of TM which might have led to bankruptcy

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(and a take-over) if the TM would have been a stand-alone company and would not have been

protected and supported by its affiliation to the Tata group and its well-connected chairman.

While it is no surprise that the crisis caused (temporary) problems and challenges for TM’s business

it seems much more remarkable how little effect it had on the company’s strategy. TM steered

through the crisis without much change in its path-changing (Nano) as well as its path-breaking

(JLR) strategy initiatives.

The constancy of purpose as well as a continuous and consistent execution of strategic plans was

maintained despite highly skeptical capital market markets which had temporarily withdrawn

support from TM. The unwavering pursuit of a transformational strategy of TM in the face of the

financial crisis can be ultimately explained only by the affiliation of the company to a very strong

and supportive conglomerate with a particular mode of operation: TM is one of the few ‘strategic’

companies of the Tata group; it is guided personally by the Chairman of the Tata Group who has

committed the group to a course of globalization and innovation while relying on India’s

comparative location advantages; it allows the company to sustain long periods of low profitability

and significant investments in resource and capability accumulation; TM profits from the value and

attraction of the TATA brand in its dealings with suppliers, customers and the Government, as well

as in attracting

talented staff; it also profits from various group support services like the groups excellence model,

its acquisition and finance expertise and its training efforts. This inherent ‘affiliation strength’

enabled TM to even use the crisis as an ‘accelerator’ for the implementation of its strategies by

legitimizing a more swift course towards cost cutting in the JLR operations (announced closure of

one plant and shift of significant supply sources to India). It may also have facilitated the far-

reaching changes in TM’s top management as experienced top managers were available due to the

crisis and a change of top management seemed to be justified in view of TM’s difficulties and

temporary low performance. It can therefore be concluded that the financial crisis has not much

affected TMs transformational change or even reinforced and accelerated it.

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FIGURES

Figure 1: Dividend and stock price snapshot of Tata Motors of last 10 years

Figure 2: PAT, Retained Earnings and equity dividend snapshot of Tata Motors of last 10 years

19911993

19951997

19992001

20032005

20072009

-1000

-500

0

500

1000

1500

2000

2500

Profit after tax Retained profitsEquity dividend

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Figure 3: Vehicle Production in India

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EXHIBITS

Exhibit 1: Dividend payout history of Tata Motors

Year MonthDividend

(%)

2010 May 150

2009 May 60

2008 May 150

2007 May 150

2006 May 130

2005 May 125

2004 May 40

2004 Jan 40

2003 May 40

2002 Jun -

2001 Jun -

2000 May 25

1999 May 30

1998 Jun 55

1997 May 80

Exhibit 2: Bonus announcement history of Tata motors

Year Month Ratio Ex-Bonus Date

1995 Sep 3:05 4/10/1995

1982 Apr 2:05 -

1979 Apr 2:05 -

1977 Apr 1:05 -

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Exhibit 3: Ratios

Mar ' 10 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06

Per share ratios

Adjusted EPS (Rs) 24.91 17.93 42.91 43.76 35.57

Adjusted cash EPS (Rs) 45.56 35.94 61.5 61.18 51.1

Reported EPS (Rs) 39.26 19.48 52.63 49.65 39.94

Reported cash EPS (Rs) 59.91 37.49 71.22 67.07 55.47

Dividend per share 15 6 15 15 13

Operating profit per share (Rs) 70.68 33.52 78.61 67.12 56.06

Book value (excl rev res) per share (Rs) 259.03 240.6 202.54 177.33 143.58

Book value (incl rev res) per share (Rs.) 259.46 241.09 203.2 178 144.26

Net operating income per share (Rs) 619.98 499.23 746.24 691.91 524.73

Free reserves per share (Rs) 229.67 217.77 182.38 157.16 123.34

Profitability ratios

Operating margin (%) 11.4 6.71 10.53 9.7 10.68

Gross profit margin (%) 8.47 3.3 8.26 7.5 8.09

Net profit margin (%) 6.26 3.77 6.96 6.94 7.35

Adjusted cash margin (%) 7.26 6.97 8.13 8.55 9.41

Adjusted return on net worth (%) 9.61 7.45 21.18 24.67 24.77

Reported return on net worth (%) 15.15 8.09 25.98 28 27.81

Return on long term funds (%) 12.26 8.89 22.85 31.18 28.65

Leverage ratios

Long term debt / Equity 0.79 0.49 0.49 0.31 0.41

Total debt/equity 1.12 1.06 0.8 0.58 0.53

Owners fund as % of total source 47.05 48.44 55.43 63.05 65.23

Fixed assets turnover ratio 1.95 1.88 2.69 3.08 2.55

Liquidity ratios

Current ratio 0.62 0.84 0.89 1.24 1.24

Current ratio (inc. st loans) 0.44 0.43 0.64 0.85 1.07

Quick ratio 0.43 0.58 0.66 0.91 0.96

Inventory turnover ratio 13.5 13.47 14.44 13.26 12.63

Payout ratios

Dividend payout ratio (net profit) 44.28 34.52 32.51 35.34 37.13

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Dividend payout ratio (cash profit) 29.02 17.94 24.02 26.16 26.73

Earning retention ratio 30.22 62.49 60.13 59.9 58.31

Cash earnings retention ratio 61.84 81.29 72.18 71.32 70.98

Coverage ratios

Adjusted cash flow time total debt 6.4 7.13 2.65 1.7 1.5

Financial charges coverage ratio 3.56 3.64 7.19 7.62 8.08

Fin. charges cov. ratio (post tax) 3.74 3.73 6.82 6.67 7.06

Component ratios

Material cost component (% earnings) 71.7 73.26 72.62 74.55 72.84

Selling cost Component 4.47 4.77 4.09 4 3.78

Exports as percent of total sales 8.61 9.49 9.88 10.18 11.87

Import comp. in raw mat. consumed 5.94 5.82 4.6 3.88 4.64

Long term assets / total Assets 0.75 0.71 0.58 0.45 0.39

Bonus component in equity capital (%) 19.5 21.64 28.86 28.87 29.06

All income figures are in Rs crore.

Exhibit 4: ONW, ROCE, Quick Ratio , Current Ratio and Interest cover of Tata MotorsAnnual Annual Annual Annual Annual Annual Annual Annual

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yyyymm (%) (%) (%) (%) Times Times Times

Finance year

PBDITA/Total income

PAT net of P&E/Total income net of P&E

RONW

ROCE

Quick ratio

Current ratio

Interest cover

1991 14.36 5.51 26.67 17.86 0.61 1.21 3.871992 12.99 4.27 20.45 12.54 0.64 1.24 2.521993 11.02 1.21 4.94 2.52 0.69 1.31 1.161994 11.65 2.38 11.04 5.17 0.79 1.34 1.371995 13.47 5.68 28.46 16.39 0.64 1.18 3.411996 13.9 6.82 27.91 21.43 0.54 1.02 5.141997 14.86 7.43 24.67 19.91 0.85 1.31 4.641998 14.06 3.99 8.02 6.03 0.79 1.24 1.771999 13.61 -1.01 -1.78 -1.27 0.53 0.84 0.892000 11.36 -0.76 -1.81 -1.31 0.43 0.86 0.882001 5.9 -5.81 -13.57 -9.71 0.35 0.8 0.052002 8.74 -2.01 -6.23 -4.11 0.28 0.76 0.552003 10.05 2.53 10.86 7.08 0.39 0.76 3.162004 11.35 5.27 26.56 19.4 0.35 0.62 14.712005 10.41 5.98 32.15 22 0.47 0.74 21.752006 11.11 6.22 31.43 21.16 0.3 0.64 16.522007 10.45 5.76 29.82 22.06 0.23 0.56 12.712008 10.37 5.85 26.9 19.09 0.33 0.59 9.662009 8.8 3.11 9.26 6 0.22 0.41 2.252010 11.97 5.53 16.33 9.52 0.29 0.48 3.84

Exhibit 5: Cash flow Rs. Crore

Mar ' 10 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06

Profit before tax 2,240.08 1,001.26 2,028.92 1,913.46 1,528.88

Net cash flow-operating activity 6,586.03 1,295.02 6,174.50 2,210.13 -221.03

Net cash used in investing activity -11,848.29 -10,644.67 -5,721.86 -2,805.10 -1.06

Net cash used in fin. activity 5,348.49 8,104.70 1,132.46 303.58 -855.27

Net inc/dec in cash and equivalent 86.23 -1,244.95 1,585.10 -291.39 -1,077.36

Cash and equivalent begin of year 630.04 2,386.77 806.21 1,118.15 2,196.79

Cash and equivalent end of year 716.27 1,141.82 2,391.31 826.76 1,119.43

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Exhibit 6: Balance sheetMar ' 10 Mar ' 09 Mar ' 08 Mar ' 07 Mar ' 06

Sources of funds (Rs. Crore)

Owner's fund

Equity share capital 570.6 514.05 385.54 385.41 382.87

Share application money - - - - -

Preference share capital - - - - -

Reserves & surplus 14,208.55 11,855.15 7,428.45 6,458.39 5,127.81

Loan fundsSecured loans 7,742.60 5,251.65 2,461.99 2,022.04 822.76

Unsecured loans 8,883.31 7,913.91 3,818.53 1,987.10 2,114.08

Total 31,405.06 25,534.76 14,094.51 10,852.94 8,447.52

Uses of fundsFixed assets

Gross block 18,416.81 13,905.17 10,830.83 8,775.80 7,971.55

Less : revaluation reserve 24.63 25.07 25.51 25.95 26.39

Less : accumulated depreciation 7,212.92 6,259.90 5,443.52 4,894.54 4,401.51

Net block 11,179.26 7,620.20 5,361.80 3,855.31 3,543.65

Capital work-in-progress 5,232.15 6,954.04 5,064.96 2,513.32 951.19

Investments 22,336.90 12,968.13 4,910.27 2,477.00 2,015.15

Net current assetsCurrent assets, loans & advances 12,329.48 10,836.58 10,781.23 10,318.42 9,812.06

Less : current liabilities & provisions 19,672.73 12,846.21 12,029.80 8,321.20 7,888.65

Total net current assets -7,343.25 -2,009.63 -1,248.57 1,997.22 1,923.41

Miscellaneous expenses not written - 2.02 6.05 10.09 14.12

Total 31,405.06 25,534.76 14,094.51 10,852.94 8,447.52

Notes:Book value of unquoted investments 21,991.93 12,358.84 4,145.82 2,117.86 1,648.57

Market value of quoted investments 345.53 558.32 2,530.55 1,323.08 1,550.00

Contingent liabilities 3,708.33 5,433.07 5,590.83 5,196.07 2,185.63Number of equity shares outstanding (Lacs) 5705.58 5140.08 3855.04 3853.74 3828.34

17 | T a t a M o t o r s - F i n a n c i a l h i s t o r y

Exhibit 7: Annual results (in brief) (Rs crore)

Mar ' 10 Mar ' 09 Mar ' 07 Mar ' 06 Mar ' 05

Sales 35,593.05 25,660.79 31,884.69 24,004.12 20,482.57

Operating profit 4,034.25 1,701.27 3,228.70 2,505.91 2,103.97

Interest 1,103.84 673.68 313.07 226.35 154.15

Gross profit 4,783.86 1,953.56 3,160.82 2,568.67 2,115.91

EPS (Rs) 39.26 19.48 49.65 39.93 34.19

(in details)

Mar ' 10 Mar ' 09 Mar ' 07 Mar ' 06 Mar ' 05

Other income 1,853.45 925.97 245.19 289.11 166.09

Stock adjustment -606.63 238.04 -349.68 -256.91 -144

Raw material 20,392.60 16,218.62 19,374.93 14,263.86 11,929.48

Power and fuel - - - - -

Employee expenses 1,836.13 1,551.39 1,367.83 1,143.13 1,039.34

Excise - - 4,349.45 3,401.92 3,063.44

Admin and selling expenses - - - - -

Research and development expenses - - - - -

Expenses capitalised -740.54 -916.02 - - -

Other expenses 10,677.24 6,867.49 3,913.46 2,946.21 2,490.34

Provisions made - - - - -

Depreciation 1,033.87 874.54 586.29 520.94 450.16

Taxation 589.46 12.5 659.72 524.5 414.95

Net profit / loss 2,240.08 1,001.26 1,913.46 1,528.88 1,236.95

Extra-ordinary item -920.45 -65.26 -1.35 5.65 -13.85

Prior year adjustments - - - - -

Equity capital 570.6 514.05 385.41 382.87 361.79

Equity dividend rate - - - - -

Agg.of non-prom. shares (Lacs) 2587.71 2031.75 2142.52 2539.98 2447.18

Agg.of non promotoion Holding (%) 51.11 45.17 55.6 66.35 67.65

OPM (%) 11.33 6.63 10.13 10.44 10.27

GPM (%) 12.78 7.35 9.84 10.57 10.25

NPM (%) 5.98 3.77 5.96 6.29 5.99

18 | T a t a M o t o r s - F i n a n c i a l h i s t o r y

Exhibit 8: Share holding

Share holding pattern as on : 31/12/2010 30/09/2010 30/06/2010

Face value 10 10 10

No. Of Shares % Holding No. Of Shares % Holding

No. Of Shares % Holding

Promoter's holding

Indian Promoters 187491741 34.93 187473186 37.02 187450911 37.02

Sub total 187491741 34.93 187473186 37.02 187450911 37.02

Non promoter's holding

Institutional investors

Banks Fin. Inst. and Insurance 64052619 11.93 70596628 13.94 78760987 15.55

FII's 130000160 24.22 119470169 23.59 113303189 22.38

Sub total 203356630 37.89 208272758 41.13 205828260 40.65

Other investors

Private Corporate Bodies 2241489 0.42 3271047 0.65 3659280 0.72

NRI's/OCB's/Foreign Others 4104697 0.76 5151215 1.02 5728469 1.13

Direcctors/Employees 236222 0.04 - - 239972 0.05

Govt 407181 0.08 407181 0.08 407181 0.08

Others 1543523 0.29 61326243 12.11 60879708 12.02

Sub total 8533112 1.59 70155686 13.85 70914610 14

General public 39497336 7.36 40479846 7.99 42187575 8.33

Grand total 438878819 81.77 506381476 100 506381356 100

19 | T a t a M o t o r s - F i n a n c i a l h i s t o r y

Exhibit 9: Financial data of Tata motors about earing and dividend per share

yearGross Block

Depreciation

Net block

Profit/ (loss)

Before Taxes Taxes

Profit/ (loss) After Taxes

Dividend

including tax

PAT to

sales

Earnings Per Share (Basic)*

Rs.

Dividend Per ShareRS.

Net worth

Per share*

(RS.)

1945-46 31 2 29 1 0 1 08.30

% 0.07 - 10

1949-50 233 44 189 11 5 6 03.60

% 0.03 - 10

1953-54 731 270 461 3 0 3 00.90

% 0.11 - 11

1954-55 792 303 489 0 0 0 00.00

% 0 - 11

1955-56 1010 407 603 125 32 93 597.80

% 1.32 0.6 12

1956-57 1352 474 878 116 27 89 444.10

% 1.64 0.8 13

1957-58 1675 668 1007 99 6 93 523.50

% 1.72 0.9 12

1958-59 2050 780 1270 155 13 142 565.40

% 1.68 0.9 12

1959-60 2201 940 1261 222 93 129 1084.60

% 1.5 1.25 13

1960-61 2593 1118 1475 313 122 191 1265.10

% 2.26 1.45 14

1961-62 2954 1336 1618 378 188 190 1244.60

% 2.28 1.45 15

1962-63 3281 1550 1731 327 185 142 1243.30

% 1.68 1.45 15

1963-64 3920 1802 2118 404 200 204 1444.00

% 1.97 1.45 16

1964-65 4789 2144 2645 479 208 271 1574.10

% 2.39 1.45 17

1965-66 5432 2540 2892 477 189 288 1913.60

% 2.2 1.45 18

1966-67 6841 3039 3802 620 192 428 2354.70

% 2.8 1.45+ 17

1967-68 7697 3608 4089 395 66 329 2353.50

% 2.1 1.45 18

1968-69 8584 4236 4348 582 173 409 2353.90

% 2.66 1.45 19

1969-70 9242 4886 4356 274 0 274 2212.80

% 1.72 1.35 19

1970-71 10060 5620 4440 673 270 403 2513.00

% 2.49 1.45 20

1971-72 10931 6487 4444 885 379 506 2733.20

% 3.04 1.5 23

1972-73 12227 7491 4736 832 360 472 2663.00

% 2.87 1.5 24

1973-74 13497 8471 5026 1007 450 557 1803.40

% 3.43 0.93 261974-75 15838 9593 6245 677 136 541 266 2.40 3.32 1.5 28

20 | T a t a M o t o r s - F i n a n c i a l h i s t o r y

%

1975-76 18642 10625 8017 855 91 764 2762.80

% 4.6 1.5 33

1976-77 20709 11685 9024 1056 0 1056 3233.70

% 5.38 1.50+ 30

1977-78 22430 12723 9707 1044 0 1044 3133.70

% 5.37 1.5 35

1978-79 24900 13895 11005 1514 0 1514 4674.00

% 5.36 1.60+ 27

1979-80 28405 15099 13306 1762 0 1762 6053.90

% 5.96 2 31

1980-81 33055 16496 16559 2437 0 2437 6054.00

% 8.27 2 38

1981-82 38819 18244 20575 4188 0 4188 8395.30

% 10.18 2.00+ 35$

1982-83 43191 20219 22972 3481 460 3021 8273.50

% 7.34 2 40

1983-84 46838 23078 23760 2163 235 1928 9232.30

% 3.61 2 37@

1984-85 52819 26826 25993 2703 390 2313 12412.50

% 4.32 2.3 39

1985-86 61943 29030 32913 1832 215 1617 12431.60

% 3 2.3 41

1986-87 68352 30914 37438 293 0 293 5520.20

% 0.51 1 40

1987-88 75712 34620 41092 3205 510 2695 13561.90

% 4.25 2.3 38@

1988-89 83455 38460 44995 8513 1510 7003 24444.20

% 6.74 2.5 40@

1989-90 91488 43070 48418 14829 4575 10254 31265.20

% 9.87 3 47

1990-91 100894 48219 52675 23455 9250 14205 41545.50

% 13.69 4 56

1991-92 123100 54609 68491 20884 7800 13084 43894.10

% 12.45 4 67@

1992-93 153612 61710 91902 3030 26 3004 36421.00

% 2.47 3 63

1993-94 177824 70285 107539 10195 20 10175 50202.70

% 7.91 4 65

1994-95 217084 81595 135489 45141 13246 31895 80685.60

% 23.29 6 104

1995-96 294239 96980 197259 76072 23070 53002 143006.70

% 21.92 6 100

1996-97 385116 117009 268107 100046 23810 76236 220677.50

% 30.4 8 143

yearGross Block

Depreciation

Net block

Profit/ (loss)

Before Taxes

Taxes

Profit/ (loss) After Taxes

Dividend

including tax

PAT to

sales

Earnings Per Share (Basic)*

Rs.

Dividend Per ShareRS.

Net worth

Per share* (RS.)

21 | T a t a M o t o r s - F i n a n c i a l h i s t o r y

1997-98 487073 141899 345174 32880 3414 29466 154844.00

% 11.51 5.5 147

1998-99 569865 165334 404531 10716 970 9746 85201.50

% 3.81 3 147

1999-00 581233 182818 398415 7520 400 7120 78030.80

% 2.78 2.5 1472000-01 591427 209067 382360 -50034 0 -50034 0 - -18.45 - 1272001-02 591006 243172 347834 -10921 -5548 -5373 0 - -1.98 - 77@

2002-03 608114 271307 336807 510372102

6 30011 144302.80

% 9.38 4 81

2003-04 627149 302369 324780 1292344820

0 81034 318255.20

% 24.68 8 102@

2004-05 715079 345428 369651 1651904149

5 123695 517156.00

% 34.38 12.50! 114@

2005-06 892274 440151 452123 2053385245

0 152888 567786.30

% 40.57 13 145@

2006-07112891

2 489454 639458 2573186597

2 191346 676396.00

% 49.76 15 178@

2007-08158957

9 544352 1045227 2576475475

5 202892 659686.00

% 52.64 15 203@

2008-09208520

6 625990 1459216 101376 1250 100126 345703.40

% 22.7 6 238++

2009-10236489

6 721292 1643604 2829545894

6 224008 991945.60

% 42.37 15 262^

Notes :@ On increased capital base due to conversion of Bonds / Convertible Debentures / Warrants / FCCN into shares.$ On increased capital base due to issue of Bonus Shares. Net Worth excludes ordinary dividends.* Equivalent to a face value of Rs.10/- per share.# Includes Interim Dividend where applicable. =+ Including on Bonus Shares issued during the year.! Includes a special dividend of Rs. 2.50 per share for the Diamond Jubilee Year. =++ on increased capital base due to Rights issue and conversion of FCCN into shares.^ On increased capital base due to GDS issue and conversion of FCCN into shares.

22 | T a t a M o t o r s - F i n a n c i a l h i s t o r y

Exhibit 10: Capital Structure of Tata Motors

From YearTo

YearClass Of

ShareAuthorized

CapitalIssued Capital

Paid Up Shares (Nos)

Paid Up Face Value

Paid Up Capital

2009 2010 Equity Share 900 570.56 570557544 10 570.56

2008 2009 Equity Share 900 514.01 514008314 10 514.01

2007 2008 Equity Share 450 385.5 385503954 10 385.5

2006 2007 Equity Share 450 385.37 385373885 10 385.37

2005 2006 Equity Share 410 382.83 382834131 10 382.83

2004 2005 Equity Share 400 361.75 361751751 10 361.75

2003 2004 Equity Share 400 352.96 352958130 10 352.96

2002 2003 Equity Share 350 319.89 319784387 10 319.78

2001 2002 Equity Share 350 319.89 319782395 10 319.78

2000 2001 Equity Share 350 255.92 255856343 10 255.86

1999 2000 Equity Share 300 255.92 255856343 10 255.86

1998 1999 Equity Share 300 255.92 255856832 10 255.86

1996 1998 Equity Share 300 255.92 255920932 10 255.92

1995 1996 Equity Share 300 241.89 241884646 10 241.88

1994 1995 Equity Share 200 137.06 137062019 10 137.06

1993 1994 Equity Share 200 128.84 128844214 10 128.84

1992 1993 Equity Share 145.5 139.61 114453700 10 114.45

1992 1993 Equity Share 145.5 139.61 14372540 8 10.78

1991 1992 Equity Share 145.5 117.47 106437808 10 106.44

1991 1992 Equity Share 145.5 117.47 22059800 5 11.03

1990 1991 Equity Share 145.5 103.67 103673600 10 103.67

1989 1990 Equity Share 145.5 103.67 103673600 10 103.67

1987 1989 Equity Share 145.5 103.67 10366501 100 103.67

1983 1984 Equity Share 55.5 52.87 5286732 100 52.87

1982 1983 Equity Share 55.5 40.92 4092197 100 40.92

1981 1982 Equity Share 55.5 40.92 4092197 100 40.92

1978 1979 Equity Share 3.55 2.92 2922998 10 2.92

1977 1978 Equity Share 25.5 18.9 1889856 100 18.9

23 | T a t a M o t o r s - F i n a n c i a l h i s t o r y

1975 1977 Equity Share 17.5 15.75 1574880 100 15.75

1971 1974 Equity Share 17.5 15.11 1510915 100 15.11

1967 1971 Equity Share 15.05 14.35 1434928 100 14.35

1966 1967 Equity Share 13 12.3 1229630 100 12.3

1965 1966 Equity Share 13 12 1199582 100 12

1963 1965 Equity Share 13 12 999935 100 10

1962 1963 Equity Share 13 10 799993 100 8

1959 1962 Equity Share 8 8 799538 100 8

1955 1957 Equity Share 5 5 500000 100 5

1950 1955 Equity Share 4 3 300000 100 3

1948 1950 Equity Share 4 2 200000 100 2

1945 1948 Equity Share 4 2 20000 1,000 2

*All values are in Rs. Crore

24 | T a t a M o t o r s - F i n a n c i a l h i s t o r y

REFERENCES

1.http://business.mapsofindia.com/automobile/car-manufacturers/tata-motors.html

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mod=googlenewswsj

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release=27953

17. http://www.tatamotors.com/our_world/press_releases.php?ID=356&action=Pull

18. http://www.autonews.com/apps/pbcs.dll/article?AID=/20080327/COPY01/803239/1193

19. http://www.reuters.com/article/ousiv/idUSBMA00084220080602

20. http://www.moneycontrol.com/news/business/tata-motors-acquires-80-stakeitaly%E2%80%99s-

trilix_488677.html

21. http://money.rediff.com/companies/tata-motors-ltd/10510008/dividend

22. http://money.rediff.com/companies/tata-motors-ltd/10510008/capital-structures

23. http://www.hwr-berlin.de/fileadmin/profpages/bruche/publications/

Bruche_Tata_Motors_and_the_Financial_Crisis.pdf

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27. http://www.moneycontrol.com/annual-report/tatamotors/chairmans-speech/TM03