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10 reasons why Cyrus Mistry was replaced as Chairman

The Tata Sons-Cyrus Mistry spat is turning uglier by the day. The conglomerate today issued a statement stating it’s beneath their dignity to engage in a public spat and claiming Mistry was given a free hand and he failed to show results.

In an exclusive newsbreak, CNBC-TV18 lists out the 10 reasons why Mistry was replaced as Chairman, as noted by sources.

— Sources say Mistry submitted a note in Oct 2010, setting out vision for Tata Group. However, after 5 years, hardly any of Mistry’s management rejig plans were implemented. Even existing structure of Group was ‘consciously’ dismantled.

— Operating companies drifted further away from the parent & majority owners. 

— Tata Sons failed to show up desired results despite Mistry having enough time to work on it.

— dividend from non-TCS group companies declined from Rs 1,000 crore in FY13 to Rs 780 crore in FY16.

— All operating companies besides TCS have been declining during the last 4 years.

— Despite a planned list of divestment there has been little or no profit on sale of investments.  

— Impairment provisions on the books increased from Rs 200 crore in FY13 to Rs 2,400 crore in FY16.

— Without TCS’ dividend & impairment provisions, Tata Sons shows operational losses over last 3 years. 

— Revenue of Tata Sons is stagnant at Rs 2,200 crore while expenses have risen sharply.

— Tata Sons’ total dependence is now on one single company – TCS – which is a source of concern.

A panelist of experts on the subject also gave CNBC-TV18 their take on the feud.

Watch video for a detailed analysis