Ratan Naval Tata, the former chairman of Tata Sons and a revered businessman and philanthropist in India, passed away at 86 on 9th October 2024. Honoured as the Padma Bhushan- India’s third highest civilian honour and Padma Vibushan- the country’s second highest civilian honour, Ratan Tata played a crucial role in modern India’s growth story through his business and philanthropic endeavours. He was also awarded the Knight Grand Cross or Dame Grand Cross of the Most Excellent Order of the British Empire (GBE)- a British order of chivalry, rewarding contributions to the arts and sciences, work with charitable and welfare organisations and public service and the Order of Australia- an Australian honour that recognises Australian citizens and other persons for outstanding achievement and service, for his global philanthropic work.
After graduating from Cornell University in 1966, Ratan spent several years in the United States. In 1970 he was called back to India and was given a managerial position at NELCO, a subsidiary of Tata Group. IN 1991, upon retiring JRD Tata the then chairman of the conglomerate declared Ratan as his successor. He was the chairman of Tata Group from 1991 to 2012 and interim chairman for one year in 2016. Upon taking the role he had to fight internal resistance from the subsidiaries who were enjoying vast operational freedom under Senior Tata’s tenure. But he successfully tackled the roadblocks and established a stable domestic business venture which later supported his global ambitions.
His decisions during this 21-year tenure played a crucial role in a newly liberalised economy accelerating India’s business sector to new heights and establishing itself as a global business giant. His ability to take bold, audacious business risks resulted in a high-profile acquisition strategy, that executed some of the biggest cross-border acquisitions in Indian corporate history.
After the collapse of Soviet Russia Tata Steel was facing the risk of heavy competition, but under the leadership of Ratan Tata the company stood fast and went on to become one of the biggest steel manufacturers in the world. He also decentralised and reformed the internal working order of the company to achieve the most efficiency. He also emphasised the modernization of the conglomerate and the testament to that is the establishment of Tata Consultancy Services (TCS) which today is one of the biggest IT companies in the world as well as a large employer of Indian talents. During the public listing of TCS IPO, it became the first private sector company to be valued at over $1 billion in the Indian market.
The first demonstration of Ratan’s global ambitions was the acquisition of a British tea brand Tetley Tea at a valuation of $430 million. At that time the company was thrice the size of Tata’s own consumer subsidiary Tata Tea and this set the tone for the future acquisitions to follow.
Next Ratan Tata made global headlines in 2007 when he steered the acquisition of the British steel giant Corus by Tata Steel. Valued at $12.9 billion this takeover is one the biggest for any Indian company to this day. The subsequent global financial crisis of 2008 resulted in bad turnouts for the company but a decade later Tata Steel stands as one of the biggest steel manufacturers of the world to this day.
Undoubtedly the most inspiring, patriotic and talked about venture of Ratan Tata is the expansion of Tata Motors by acquiring Jaguar and Land Rover from Ford Motors. In 1998 Tata Motors launched their passenger car business with a model Indica for Indian markets. However, the lacklustre reception of the product led the company and Ratan Tata to seek a deal to sell the venture to Ford Motors when the US firm had shown its interest in buying it. In 99’ Ratan and his team went to Detroit, USA to meet then-Ford chairman Bill Ford. But the 90-minute meeting didn’t go as planned. According to an attendee of the meeting, Bill Ford was arrogant and condescending to Ratan Tata and his team. He insinuated that he was doing a favour to the Indian brand by buying them. Tata felt humiliated by this action and later the deal was cancelled from the Indian side. However, Ratan Tata got the last say in this tale as he bought JLR in 2008 from Ford Motors and the American company stated that Ratan was doing them a favour by actually buying the brands.
The Jaguar and Land Rover were British car brands that were acquired by Ford at a valuation of $2.5 billion and $2.7 billion respectively. However, the company was unable to make a profit through these cars. By the time the 2008 financial crisis hit the global market, Ford had lost $10 billion in total from these two brands which included the acquisition, maintenance, operation and ownership cost of 19 years collectively. The US firm was desperately looking to sell these brands. That’s when Tata Motors swooped in and acquired the JLR at a valuation of $2.3 billion.
Soon after that Tata Motors allotted another $1 billion for RnD and operational cost. With the direct involvement of Tata Motors, JLR in the first year of the acquisition showed a profit of $90.5 million in 2009 and has increased ever since. Even as Tata Motors has come a long way and gained a big market share in India, it continues to earn a significant part of its revenues from the JLR. This tale is famously known as Tata’s $2.3 billion revenge.
Apart from these, his work in establishing Tata’s consumer brand Titan, and expanding other subsidiaries like luxury hotel chain Taj, Tata Power, Tata Chemicals, and Tata Global Beverages established him as a visionary leader of the multigenerational conglomerate. During his tenure of 21 years, the company saw a revenue growth of 40 times and profit growth of 50 times. It has 29 publicly listed Tata Group companies with a combined market capitalisation of $403 billion as of 20 August 2024.
Much of the reverence the people hold today for Ratan Tata came from him being a person of commentary character which was reflected by his many philanthropic and humanitarian ventures. The conglomerate Tata Sons since its establishment holds a philanthropic approach. The company’s 66% profit share is held by Tata Trusts which channels the money into several charitable causes. Under Tatan Tata, the trust helped move forward many causes in the sector of education, financial assistance, healthcare support, disaster management and relief and animal protection shelters. He was also an animal lover in his personal life, especially dogs. As per his orders, the doors of Taj House and Taj Hotel in Mumbai never close on any stray dogs. The last personal project of his life was to open India’s first Small Animal Hospital in Mumbai in 2023. The facility, which is state-of-the-art and spread across 98,000 square feet, was built to meet a range of healthcare treatments that pets and stray dogs might need.
Throughout his lifetime he never married and has no heir. His companions were his several pet dogs till his last days. However, it would be wrong to say he lived by no one because Ratan Naval Tata lived by billions of Indians whom he considered his family and inspires even after his death. With his death, India truly lost a RATAN (a gem).