Presentation on Company Analysis of Tata Motors

PRESENTED BY:

KUMAR SAURABH

MBA( FINANCE & MARKETING)

4TH SEMESTER

Introduction Tata Motors Limited is an Indian multinational automotive manufacturing company headquartered in

Mumbai, India. Its products include passenger cars, trucks, vans, coaches, buses, construction

equipment and military vehicles.

Founded in 1945 by JRD TATA as manufacturer of locomotives  the company manufactured its first

commercial vehicle in 1954 in a collaboration with Daimler-Benz AG, which ended in 1969.

Tata Motors entered the passenger vehicle market in 1991 with the launch of the Tata Sierra, becoming

the first Indian manufacturer to achieve the capability of developing a competitive indigenous

automobile

The company is ranked 226th on the Fortune Global 500 list of the world's biggest corporations as of

2016.

Company Profile Tata Motors is India's largest automobile company, with consolidated revenues of Rs1,88,818

crore (USD 34.7 billion) in 2012-13. 

Through subsidiaries and associate companies, Tata Motors has operations in the UK, South

Korea, Thailand, Spain, South Africa and Indonesia. Among them is Jaguar Land Rover, the

business comprising the two iconic British brands. 

Tata Motors is the country's market leader in commercial vehicles and among the top three in

passenger vehicles. It is also the world's fifth-largest truck and fourth-largest bus manufacturer.

Tata Motors has over 4,500 engineers, technicians and scientists at R&D centres in India, South

Korea, Italy, Spain and the UK.

Competitors

Area of businessTata Motors makes passenger cars, multi-utility vehicles and light, medium and heavy commercial

vehicles.

Passenger cars: The company launched the compact Tata Indica in 1998, the sedan Indigo in

2002 and the station wagon Indigo Marina in 2004.

Utility vehicles: The Tata Sumo was launched in 1994 and the Tata Safari in 1998.

Commercial vehicles: The commercial vehicle range extends from the light two-tonne truck to

heavy dumpers and multi-axled vehicles in the above 40-tonne segment.

Passenger buses: The company also manufactures and sells passenger buses, 12-seaters to 60-

seaters, in the light, medium and heavy segments.

SWOT Analysis

Strengths:

One of the most established company in automobile sector

Wide & extensive distribution and service network

Good market penetration in the taxi & rental segment

Expert service professionals available

Dedicated engineering and R&D department

More than 60,000 employees

Weakness:

Limited international presence

Sometimes faces alleged quality and durability issues

Not much customer engagement programs and activities

Opportunities:

Expanding automobile market and available space for competitors

Increasing per capita income and purchasing capability of potential customer base

Leveraging customer engagement experience to acquire new customers

Leveraging mergers and acquisitions to acquire newer technology

Threats:

Increasing fuel costs

Competition from other big automobile giants

Competitive products offering same level features at a lesser price

Product innovations and frugal engineering by competitors

Financial Analysis

Gross Profit Ratio:

year Gross Profit (cr)

Sales (cr)

GP Ratio

2012-13

4267.44 17199.17 24.81%

2013-14

4782.7 20088.63 23.80%

2014-15

5934.01 26664.25 22.25%

2015-16

6567.35 28738.30 22.88%

Gross Profit Ratio= Gross profit/ Net Sales *100

2012-13 2013-14 2014-15 2015-1620.50%21.00%21.50%22.00%22.50%23.00%23.50%24.00%24.50%25.00%25.50%

24.81%

23.80%

22.25%

22.88%

Gross Profit ratio

year Sales(cr) Net profit (cr)

NP Ratio

2012-13 17199.17 2000.05 11.62%2013-14 20088.63 2146.36 10.68%2014-15 26664.25 2586.51 9.70%2015-16 28738.30 3000.91 10.44%

Net profit ratio

Net profit after tax / Net sales * 100

2012-13 2013-14 2014-15 2015-168.50%

9.00%

9.50%

10.00%

10.50%

11.00%

11.50%

12.00%

Net profit ratio

Debt Equity ratio:

year debt(cr) equity (cr)

D/E Ratio

2012-13 2495.42 6606.81 0.372013-14 2936.84 8447.52 0.342014-15 4009.14 10852.9

40.36

2015-16 6280.52 14094.51

0.44

Debt Equity ratio= Total liabilities / stakeholders equity

ratio0

0.050.1

0.150.2

0.250.3

0.350.4

0.450.5

Debt Equity ratio

2012-13 2013-14 2014-15 2015-16

Return on Net worth:

Return on net worth = Net profit / Equity

year Net profit (cr)

equity (cr)

D/E Ratio

2012-13 2000.05 6606.81 0.372013-14 2146.36 8447.52 0.342014-15 2586.51 10852.9

40.36

2015-16 3000.91 14094.51

0.44 ratio0

0.050.1

0.150.2

0.250.3

0.350.3

0.25 0.23 0.21

Debt equity ratio

2012-13 2013-14 2014-15 2015-16

Findings

Gross Profit ratio of the company has been almost consistent over the years which shows that the company can reduce the selling price of the products without incurring loss.

Net profit ratio of the company has been improving over the years which shows that company has been in good stage in terms of profitability.

Debt Equity ratio of the company has been less than 1 over the years which shows that the portion of assets provided by stockholders is greater than the portion of assets provided by creditors.

Return on net worth has increased over the year which shows that the company’s profitability has increased over the years