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Tata Motors Ltd. (TTM)

Market Cap: 6.06B

Recent Share Price: $17.82

The Business

Tata Motors is India's largest automobile company. Tata leads commercial sales in all segments, and is the second largest in the compact, midsize car and utility vehicle segments. 1400 engineers and scientists devolop Tata's leading products. Tata has had increasing vehicle sales year-over-year, they are an experienced company, and have little institutional ownership with great insider ownership. Tata Motors takes part in the design, manufacturing, assembly, and sales of their vehicles. India has increasing needs and wants for cars as their economy grows. Only eight in 1000 Indians own a car, that shows major growth opportunity! But Tata has also starting to expand to East Asia, Western Europe and parts of Africa. Tata Motors bought South-Korean truck maker in Daewoo Commercial Vehicle in March 2004, and last year acquired 21% stake of Spanish bus and coach maker Hispano Carrocera.

In 1945 Tata Locomotive and Engineering Company Limited was the name of the newly incorporated Indian company, in 1960 it was changed to Tata Engineering and Locomotive Company Limited, and in 2003 its name was changed to Tata Motors Limited.
Tata Motors is now headquartered in Mumbai, India.

Subsidiaries (Obtained from Tata Motors website):

Through its subsidiaries, the company is engaged in engineering and automotive solutions, construction equipment manufacturing, automotive vehicle components manufacturing and supply chain activities, machine tools and factory automation solutions, high-precision tooling and plastic and electronic components for automotive and computer applications, and automotive retailing and service operations.

The Risks

Tata Motors and Fiat have come together recently. This makes it so Fiat can sell their cars through Tata's dealers. Fiats sales have been no where near the amount Tata has sold (Tata sold 10,000 more vehicles this December), so they are not becoming big in the Indian market.

At the moment Toyota finds it very hard to make a small car in India and make a profit, quoting the Vice Chairman "It would be very challenging to make a small car in India and keep it profitable now. There are already three big players -- Maruti, Hyundai and Tata Motors -- we will have to compete with."

Maruti sold 50,109 vehicles January, so they are a big player. Tata is in a great position though. Tata has other markets, which is the way they can beat off Maruti. Tata is expanding to other areas outside of India, they are the leader in commercial vehicles, they do trucks of sorts, and all their segments are growing! What I'm saying is Maruti is only a big player in small cars, Tata is big in the commercial world also, so they have different markets to grow in.

Hyundai Motor India sold 8,313 vehicles this January, so I don't see them as a huge threat right now. Tata Motors has a big lead, they are experienced in the Indian market, I just don't see them failing.

GM is in India, but far behind Tata. GM sold 30,837 cars in India in 2005, which was 18% higher than the previous year, but Tata has been growing at a faster rate and they sell much more vehicles every year, so I see GM as a small player right now. GM hopes to sell 50,000 vehicles this year in India.

Quick Financial Figures

Revenue: $4.71 Billion

Gross Profit: $951 Million

Profit Margin: 6.76%

Long-term debt: $587,600

Net Income: $304,000

Dividend: $0.23 (1.4%)


Insider Ownership: 35.68%

Institutional Ownership: 4.50%

Tata Motors reported a total sale of 46,635 vehicles (including exports) for the month of January '06, a growth of 19.6% over 39,000 vehicles sold in January last year. Cumulative sales for the Company at 352,819 nos. are growing by 10.9%

Commercial Vehicles

The Company's sales of commercial vehicles in January '06 in the domestic market were 21,301 nos., an increase of 25.3% over 17,003 vehicles sold in January last year. M&HCV sales stood at 13,086 nos., while LCV sales were 8215 nos.

Cumulative sales of commercial vehicles in the domestic market for the fiscal were 164,770 nos.

Passenger Cars

The passenger car business reported its highest ever monthly sales with an achievement of 20,765 vehicles, in the domestic market in January '06, a growth of 15% over January '05. The Indica grew by 18.7% at 12,640 nos. – the sales being the highest ever in any month primarily on account of good demand for the January '06 introduced Indica V2 Xeta Petrol and the October '05 introduced Indica V2 Turbo Diesel. The Indigo range grew by 15.6% with a sale of 3865 nos. The Sumo and Safari accounted for sales of 4260 nos., a growth of 5%.

Cumulative sales of passenger cars in the domestic market for the fiscal were 148,275 nos., a growth of 3.7%.


The Company's sales from exports were 4569 vehicles in January '06 as compared to 3943 vehicles in January '05, an increase of 15.9%. The cumulative sales from exports in the current period at 39,774 nos. have recorded a 71.1% growth over the corresponding figures for the previous period.


Tata Motors Ltd.
Bombay House
24 Homi Mody Street
Mumbai, 400001
Phone: 91 22 2204 9131

Links for further research:

Tata's CEO, Mr. Ratan N. Tata:

Quarterly Results:

Annual Reports:

Tata Motors Manufacturing Details:

Tata Motors at Yahoo! Finance: Tata Motors Discussion Board:

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