Reports have spoken of how it is looking to borrow $1 billion from the overseas markets to set up a mobile phone and component contract manufacturing plant in Tamil Nadu. The focus of Tata Sons is to look at sunrise industries and ensure the group has a serious play there

The unlisted Tata Sons is the prized jewel in the salt-to-software conglomerate. As the holding company, it is entrusted with the responsibility of identifying new business opportunities in a manner where capital is sensibly allocated. This entity is now seeking shareholder approval to raise up to Rs 40,000 crore by way of debt, which will largely be bonds and non-convertible debentures. Just what could the money be needed for?

Over the last year in particular, the group has identified several new areas. As recently as end-July, Tata Sons acquired a 43.3% stake in Tejas Networks, a player in the business of manufacturing networking products to telecommunications service providers, utilities and internet service providers. More than just the deal, many might have expected one of the group companies to spearhead the transactions. Instead, it was Tata Sons that made the buyout signalling a clear intent from the holding company and also the most richly valued in the group. There has been more than one instance of that.

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Media reports have spoken of how it is looking to borrow $1 billion from the overseas markets to set up a mobile phone and component contract manufacturing plant in Tamil Nadu. The focus of Tata Sons is to look at sunrise industries and ensure the group has a serious play there. Here is where healthcare, medical devices start to look interesting. Also, the opening up of the defence industry to greater levels of private participation is another opportunity; in the case of Tata Sons, its subsidiary Tata Advanced Systems is specifically there for this and aerospace.

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Besides, the interest in manufacturing semiconductors has been spoken of by Tata Sons Chairman N Chandrasekaran. It comes on the back of a shortage globally and seriously hampering the automotive industry.

Of course, all eyes will be on Air India, a company that the Tata group is keen on acquiring. The government-owned entity, once owned by JRD Tata before it was nationalised, is in need of funds. In a recent interaction with the media, government officials said the buyer will need to put in at least $1 billion to refurbish operations including the purchase of aircraft. This is in addition to the government expecting at least Rs 15,000 crore from the sale of Air India. Clearly, a busy time ahead for Tata Sons.

https://www.businesstoday.in/amp/industry/top-story/story/busy-time-ahead-as-tata-sons-eyes-foray-into-several-sunrise-industries-305104-2021-08-24