Mumbai: Cyrus Mistry, who will take over the reign of the $100-billion Tata Group from Ratan Tata on Friday has a difficult act to follow, feel experts.
Mistry is the second person from outside the Tata family to hold this position.
“Mr Ratan Tata, who ran the company for 20 years, has transformed it from a $3 billion company to $100 billion. To replicate, it will be the most challenging task for Mr Mistry,” said Mohan Guruswamy, distinguished fellow at Observer Research Founda-tion.
He said that it is for the first time that a shareholder in the company will also be running the company. Mistry family owns 18 per cent stake in Tata Sons.
Crisil’s director (economy research), Dr Sunil K. Sinha, said that it will be challenging for Mistry to fit into the shoes of Tata.
“Mr Ratan Tata transformed the Tata Group from a reluctant corporation to an aggressive corporation. He went for an inorganic growth by making some remarkable acquisition like JLR and Corus. The most important characteristic of these acquisitions was that the company, which were being acquired had more net worth than the company which was acquiring it,” he said.
According to experts, immediate challenges for Mistry will be improving the margins of Tata Steel. The company is still reeling under a debt of $12.3 billion from the acquisition of the Corus.
Even though the company is getting the benefits of JLR deal, Mistry can’t sit complacent on this and will need to further improve the brand.
“JRD Tata consolidated group’s business within the country and Mr Tata took it globally. So it will be interesting to see what trajectory the company will take under Mr Mistry,” said an analyst who closely tack the group.