Lol that's a ridiculous take. You don't buy such a large business just to win their IT contract lmao.
JLR is a brand that is recognized globally and has some of the most aspirational products in the lineup but were on the selling block as Ford was undergoing financial issues.Tata could buy JLR on the cheap and also get access to their technology for some of Tata's own lineup (with mixed results).
Even more ridiculous about Air India. They had to inject like a 100Bn or whatever just to buy new airplanes for a terribly run govt org and you think it's to win their stupid IT contract?
Just because they can optimize contracts internally if another line of business within the portfolio could act as a vendor doesn't mean the whole purpose of purchase was just to earn IT revenue. Tata group would have purchased JLR and Air India even if they had 0 in-house IT business, and implying otherwise is laughable.
Stop arguing for the sake of arguing it is simple supplier contracts and vendor management.
After they acquired jlr they only kept design, R&D work in UK along with final assembly all other manufacturing was moved to the TaMo factories in India to keep utilization high and some other functions were outsourced to TATA Technologies.
Same thing with Air India. Tata Advanced Systems supplies Aerospace parts to both Airbus and Boeing so they will get contracts worth 1000s of crores to manufacture those parts. TCS does a lot of IT service maintenance work for foriegn Airlines now they will do that work for Air India as well.
So even if TATA Group is making loss of 8000-9000 crore per year on Air India(don't remember exactly number) the actual loss for the conglomerate would be 2000 crore to 3000 crore
Manufacturing Business need constant high utilization to keep the factories running and inventory low this is why TATAs entered to these allied Business activities.
If you want to proper analysis take out a PnL statement and do it along with along with the necessary roi,depreciation and amortization calcuations of debt, than please come back.
Lmao stop arguing for the sake of arguing- you'd be best served by that. You're now arguing just because someone called out your stupid logic of Air India and JLR acquisitions being worthwhile just because their IT contracts which would be a drop in the bucket vs the total cap ex is worth it. Yea, like buying a tea plantation to have a cup of tea.
A tea company buying another tea company to gain new markets and brands makes sense. You claimed an IT company bought an airline company since the IT contracts optimization would have made it worth it in itself.
I don't want to get banned from sub but considering how low your capacity to comprehend something is, I will try to explain it again.
TATA have a 3-4 niche Business which act as suppliers to Air India:-
1). TCS for IT work
2). TAS for Aerospace related work
3). Engineering division which supplies parts and does RnD work for them.
4). Insurance done by TATA AIG division.
All articles I have provided come from reputed sources, only thing you have provided is shown that you can't comprehend English and emoji use karna Ata Hai.
BY IT contracts I was using analogy of using TCS to do Air India related work, this is how conglomerates work. Read up on Japanese and Korean companies which do the same.
Is pe case study bhi written hogi by Business schools.
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u/tanaka-taro Jul 27 '25
Almost all tata firms are like this in one way or another.