Case Study: Tata Motors: Can the Turnaround Plan improve Performance?

Please Answer the following questions

1. Review the financial statements and market position, Identify the main issues that TATA Motors faced.
2. Conduct Dupont analysis of TATA Motors by using Five Factor Dupont Model.
3. Conduct Dupont analysis of TATA Motors by using Three Factor Dupont Model.
4. Conduct SWOT analysis of the company and provide your concluding recommendation for the revival of the company.
5. Based on your financial and business analysis of the company, what strategies do you recommend to improve the companys financial position?

EXHIBIT 7: CONSOLIDATED INCOME STATEMENTS OF TATA MOTORS AND SUBSIDIARIES, 2013-2018 2013 2014 2015 2016 2017 2018 1.887.927 1.138,471 749,456 2.328.337 1.339.531 988.805 2,631,590 1.484.710 1,146,880 2.776,606 1,534,433 1.242.173 813,697 2.744.921 1.593,453 1.151,468 2.954,093 1,742,884 1,211,209 478.948 630,911 882,237 780.936 854,120 246,555 334.706 437,203 410.620 461,433 283,329 166,322 86.071 20.216 76.013 215.564 80,841 25,652 110.782 9.854 341,734 255,490 85,014 28,752 133,886 1.847 43, 110 288.809 87.685 34.688 167,108 18,504 88.987 34,136 179,050 (11.146) 303,001 89,686 35,319 215,536 (19,751) 6,027 Fiscal year ended March 31 (in 7 million except per share data) Revenue Cost of Revenue Gross Profit Selling/General/Administrative Expenses Selling/General/Administrative Expense Labour and Related Expense Advertising Expense Research and Development Depreciation and Amortization Unusual Expense (Income) Other Operating Expense Total Operating Expense (including Cost of Revenue) Operating Income Interest Income (Expense), Net Other Expense/Income,Net Net Income before Taxes Provision for Income Taxes Net Income after Taxes Minority Interest Equity in Affiliates Net Income Basic Weighted Average Shares Basic EPS Excluding Extraordinary Items Basic EPS Including Extraordinary Items 1.719,875 2.116.7302,374,542 2,568,430 2.576.429 2.828,108 125,985 168.252 (24,828) (6.952) 138,472 37.767 98,705 211,607 (16,367) (6.551) 188.689 47.648 141.041 208.176 (59.230) (7,690) 141.256 30.251 257.048 8.540 (8.126) 257,462 76,429 181,033 (868) 134 180,299 3.253 168.492 (67.810) (7.534) 93,148 32,512 60.636 (1.022) 14,930 74,544 3,396 (4.817) (9.820) 111,548 43,419 68,129 (1.025) 22,783 89,887 3.396 (837) 1,056 98.924 3.222 111,005 (989) 5.775 115.791 3,379 (595) (537) 139.909 3,249 30.70 43.06 55.43 34.27 21.95 26.47 30.70 43.07 55.43 34.27 21.95 26.47 EXHIBIT 9: CONSOLIDATED BALANCE SHEET OF TATA MOTORS AND SUBSIDIARIES, 2012- 2018 2012 2013 2014 2015 2016 2017 2018 244,345 84,191 84,139 96,014 190,722 85,631 223,163 78.779 0 144.385 226,822 298,170 77.295 0 220,875 237,965 111,959 442,570 370 197,061 245,139 185,209 137.485 491,676 401 171.135 320.140 202,629 508,807 139.868 0 368,939 211,810 492,811 147.168 0 345,844 289,383 112.813 148,452 154,530 211,550 (3.262) (3.217) (6.217) (7.757) (12,743) (13.774) (12,617) 108,353 84,247 Fiscal year ended March 31 (in millions) Assets Cash and Short-Term Investments Cash Cash and Equivalents Short-Term Investments Accounts Receivable Accounts Receivable, Trade, Gross Provision for Doubtful Accounts Notes Receivable, Short Term Receivables. Other Total Inventory Inventories, Finished Goods Inventories, Work in Progress Inventories, Raw Materials Inventories, Other Prepaid Expenses Other Current Assets, Total Restricted Cash, Current Discontinued Operations, Current Asset Other Current Assets Total Current Assets Property Plant'Equipment, Net Buildings. Gross Land/Improvements. 64,382 52.844 210,368 166,711 85.624 46,599 272,709 225,108 51,523 3.958 296,433 229,415 63.397 3,523 335,865 254,870 182,160 140,131 68.820 2.234 357,697 287,694 6.203 443,981 344,909 19,248 26.570 33.645 42.589 36,426 40.432 25.224 8,149 10,584 23.757 9.820 32.280 28,361 21.640 21,021 997 15,206 65,976 63,408 21.900 881 4.499 22,890 13,299 19,701 1.330 18,652 130,959 95,048 26.259 12.147 11.174 57,892 5,308 82,885 60,773 2.347 2.384 35.912 958, 453 9,501 644,615 302,401 89,677 16,975 2.568 741,536 370,741 82.679 58,426 995,569 631,173 52.584 1,099,237 714,780 121.642 0 80.502 1,161,198 697,814 120.143 67.620 133,553 4,939 25,852 102,762 1,359,728 900,108 164,929 508,316 109,465 20.280 98,656 16,936 Gross 66,531 71,615 73,386 585,532 842,165 804,579 663,011 813,923 816,179 1,023,635 31,215 43,451 88,527 65.510 101.868 Machinery/Equipment Gross Construction in Progress Gross Leases, Gross Other Property/Plant/Equipment, Gross numuntad 101.373 4.043 161,429 930 3,959 4,022 234 797 667 10,702 12,234 15,394 23.243 26,204 23,904 21.884 3,959 4,022 4,043 234 797 687 930 10,702 12.234 15,394 23,243 26,204 23,904 21,884 Leases, Gross Other Property/Plant/Equipment, Gross Accumulated Depreciation, Total Goodwill, Net Intangibles, Net Intangibles, Gross Accumulated Intangible Amortization Long-Term (LT) Investments LT Investment. Affiliate Companies LT Investments, Other (435,680) (430,746) 40,937 41,024 259,724 327,889 319, 189 414,369 (59,465) (86.480) (546,817) 49,788 465,438 800.775 (141,337) (309,029) 7,320 530,637 716,431 (185,795) (384.910) (432,566) (546,086) 7,598 6,733 1,165 609,129 591,882 713,201 841,307 834.97 1,085,067 (232,178) (243,115) (371,886) 45,350 52,968 56,517 13,915 12.224 11,144 39,434 6.686 7,230 4,517 7,707 3,830 7,314 37,575 1,860 37,640 7,710 46,080 6.908 48,879 7,638 EXHIBIT 9 (CONTINUED) 2012 2013 2014 2015 2016 2017 Fiscal year ended March 31 (in t millions) Note Receivable, Long 2018 136,580 149,547 Term 124.634 111,096 114,418 141,709 186,799 60,823 82,210 95,987 51,140 0 45,393 66.209 19,836 10,339 44,289 15,092 23,471 80,900 23,090 39,570 85.240 9,573 44,573 11.443 41,587 40,494 0 0 0 3,268 2,327 1,318 1,739 8,195 41 219 5.747 1,449,312 43,647 2,611 15,913 29,778 1,703,782 2.199,983 2,381,437 2,671,412 2,737,544 3,313,505 0 44,795 449,124 57,999 116,202 573,157 44,611 96,959 581,715 30,510 131,547 615,618 36,284 114,508 625,326 10,122 138,599 769,398 12.024 167.949 40,787 56,878 41,140 49,490 220,674 73,988 230,097 109,581 373 263 341,100 Other Long-Term Assets, Total Deferred Charges Deferred Income Tax, Long Term Asset Restricted Cash, Long Term Other Long-Term Assets Total Assets Liabilities and Equities Liabilities Accounts Payable Accrued Expenses Notes Payable/Short Temm Debt Current Portion of LT Debt Capital Leases Other Current Liabilities Dividends Payable Customer Advances Income Taxes Payable Other Payables Discontinued Operations, Current Liability Other Current Liabilities Total Current Liabilities Total Long-Term Debt Long-Term Debt Capital Lease Obligations Deferred Income Tax Minority Interest Other Long-Term Liabilities Total Liabilities 191,865 455.233 12,807 23,888 11,638 335.696 99,402 142.730 6,452 21.833 17.920 19,624 151,956 6,486 22,937 13.900 25,802 30,871 8,201 48,052 36,819 7,235 35,031 15,591 13,926 31,204 44.238 0 10.702 71,404 732,681 279,625 279.625 0 76,901 82,762 865,457 923,561 321,563 452.586 321,553 452,430 0 158 20,482 15,723 3,705 4.207 116,213 147.872 1,327,409 1,543,949 135,750 151,012 295,970 302.735 993,936 1,070,494 1,156,295 1,432,195 546,071 505,104 608,292 611,995 545,164 504,414 605,752 611 528 908 690 540 488 26,850 45,440 11.740 61 258 4,298 4,328 4,532 5.251 257,547 258,512 378,000 248,528 1,828,711 1,881,887 2,156,9252,359,226 21,651 3.071 85,300 1,122,327 2012 2013 2014 2015 2016 2017 2018 Fiscal year ended March 31 in 2 millions) Shareholders' Equity Common Stock, Total Additional Paid In Capital Retained Eamings (Accumulated Deficit) Unrealized Gain (Loss) Other Equity. Total Translation Ad ustment Other Equity Minimum Pension Liability Adjustment Other Comprehensive Income Total Equity Total Liabilities and Shareholders' Equity 6,348 111.868 250,898 929 (43,057) (2.740) 0 (38.706) 6.381 6.438 6.438 6.792 6,792 6.792 113.288 116,831 114.898 188,874 188,919 188,919 342.854 476,758 455,627 609,838 617,960 746,948 328 229 (52,783) (61.522) (179,116) (36.280) (86,544) 55.781 28,548 45.542 (53,936) 47.880 (8,516) 77,469 29.450 48,522 (53,001) 46.212 0 0 (911) (1.027) (193) 228 (62,247) (75,684) 0 0 0 0 (15,781) 53.998 0 47 (742) 1,440 376,373 656,035 552,726 789,524 580.619 954 279 1,703,782 2.199,984 2.381,437 2,671,411 2,737,544 3,313,505 (1.612) 326,985 1.449,312 EXHIBIT 7: CONSOLIDATED INCOME STATEMENTS OF TATA MOTORS AND SUBSIDIARIES, 2013-2018 2013 2014 2015 2016 2017 2018 1.887.927 1.138,471 749,456 2.328.337 1.339.531 988.805 2,631,590 1.484.710 1,146,880 2.776,606 1,534,433 1.242.173 813,697 2.744.921 1.593,453 1.151,468 2.954,093 1,742,884 1,211,209 478.948 630,911 882,237 780.936 854,120 246,555 334.706 437,203 410.620 461,433 283,329 166,322 86.071 20.216 76.013 215.564 80,841 25,652 110.782 9.854 341,734 255,490 85,014 28,752 133,886 1.847 43, 110 288.809 87.685 34.688 167,108 18,504 88.987 34,136 179,050 (11.146) 303,001 89,686 35,319 215,536 (19,751) 6,027 Fiscal year ended March 31 (in 7 million except per share data) Revenue Cost of Revenue Gross Profit Selling/General/Administrative Expenses Selling/General/Administrative Expense Labour and Related Expense Advertising Expense Research and Development Depreciation and Amortization Unusual Expense (Income) Other Operating Expense Total Operating Expense (including Cost of Revenue) Operating Income Interest Income (Expense), Net Other Expense/Income,Net Net Income before Taxes Provision for Income Taxes Net Income after Taxes Minority Interest Equity in Affiliates Net Income Basic Weighted Average Shares Basic EPS Excluding Extraordinary Items Basic EPS Including Extraordinary Items 1.719,875 2.116.7302,374,542 2,568,430 2.576.429 2.828,108 125,985 168.252 (24,828) (6.952) 138,472 37.767 98,705 211,607 (16,367) (6.551) 188.689 47.648 141.041 208.176 (59.230) (7,690) 141.256 30.251 257.048 8.540 (8.126) 257,462 76,429 181,033 (868) 134 180,299 3.253 168.492 (67.810) (7.534) 93,148 32,512 60.636 (1.022) 14,930 74,544 3,396 (4.817) (9.820) 111,548 43,419 68,129 (1.025) 22,783 89,887 3.396 (837) 1,056 98.924 3.222 111,005 (989) 5.775 115.791 3,379 (595) (537) 139.909 3,249 30.70 43.06 55.43 34.27 21.95 26.47 30.70 43.07 55.43 34.27 21.95 26.47 EXHIBIT 9: CONSOLIDATED BALANCE SHEET OF TATA MOTORS AND SUBSIDIARIES, 2012- 2018 2012 2013 2014 2015 2016 2017 2018 244,345 84,191 84,139 96,014 190,722 85,631 223,163 78.779 0 144.385 226,822 298,170 77.295 0 220,875 237,965 111,959 442,570 370 197,061 245,139 185,209 137.485 491,676 401 171.135 320.140 202,629 508,807 139.868 0 368,939 211,810 492,811 147.168 0 345,844 289,383 112.813 148,452 154,530 211,550 (3.262) (3.217) (6.217) (7.757) (12,743) (13.774) (12,617) 108,353 84,247 Fiscal year ended March 31 (in millions) Assets Cash and Short-Term Investments Cash Cash and Equivalents Short-Term Investments Accounts Receivable Accounts Receivable, Trade, Gross Provision for Doubtful Accounts Notes Receivable, Short Term Receivables. Other Total Inventory Inventories, Finished Goods Inventories, Work in Progress Inventories, Raw Materials Inventories, Other Prepaid Expenses Other Current Assets, Total Restricted Cash, Current Discontinued Operations, Current Asset Other Current Assets Total Current Assets Property Plant'Equipment, Net Buildings. Gross Land/Improvements. 64,382 52.844 210,368 166,711 85.624 46,599 272,709 225,108 51,523 3.958 296,433 229,415 63.397 3,523 335,865 254,870 182,160 140,131 68.820 2.234 357,697 287,694 6.203 443,981 344,909 19,248 26.570 33.645 42.589 36,426 40.432 25.224 8,149 10,584 23.757 9.820 32.280 28,361 21.640 21,021 997 15,206 65,976 63,408 21.900 881 4.499 22,890 13,299 19,701 1.330 18,652 130,959 95,048 26.259 12.147 11.174 57,892 5,308 82,885 60,773 2.347 2.384 35.912 958, 453 9,501 644,615 302,401 89,677 16,975 2.568 741,536 370,741 82.679 58,426 995,569 631,173 52.584 1,099,237 714,780 121.642 0 80.502 1,161,198 697,814 120.143 67.620 133,553 4,939 25,852 102,762 1,359,728 900,108 164,929 508,316 109,465 20.280 98,656 16,936 Gross 66,531 71,615 73,386 585,532 842,165 804,579 663,011 813,923 816,179 1,023,635 31,215 43,451 88,527 65.510 101.868 Machinery/Equipment Gross Construction in Progress Gross Leases, Gross Other Property/Plant/Equipment, Gross numuntad 101.373 4.043 161,429 930 3,959 4,022 234 797 667 10,702 12,234 15,394 23.243 26,204 23,904 21.884 3,959 4,022 4,043 234 797 687 930 10,702 12.234 15,394 23,243 26,204 23,904 21,884 Leases, Gross Other Property/Plant/Equipment, Gross Accumulated Depreciation, Total Goodwill, Net Intangibles, Net Intangibles, Gross Accumulated Intangible Amortization Long-Term (LT) Investments LT Investment. Affiliate Companies LT Investments, Other (435,680) (430,746) 40,937 41,024 259,724 327,889 319, 189 414,369 (59,465) (86.480) (546,817) 49,788 465,438 800.775 (141,337) (309,029) 7,320 530,637 716,431 (185,795) (384.910) (432,566) (546,086) 7,598 6,733 1,165 609,129 591,882 713,201 841,307 834.97 1,085,067 (232,178) (243,115) (371,886) 45,350 52,968 56,517 13,915 12.224 11,144 39,434 6.686 7,230 4,517 7,707 3,830 7,314 37,575 1,860 37,640 7,710 46,080 6.908 48,879 7,638 EXHIBIT 9 (CONTINUED) 2012 2013 2014 2015 2016 2017 Fiscal year ended March 31 (in t millions) Note Receivable, Long 2018 136,580 149,547 Term 124.634 111,096 114,418 141,709 186,799 60,823 82,210 95,987 51,140 0 45,393 66.209 19,836 10,339 44,289 15,092 23,471 80,900 23,090 39,570 85.240 9,573 44,573 11.443 41,587 40,494 0 0 0 3,268 2,327 1,318 1,739 8,195 41 219 5.747 1,449,312 43,647 2,611 15,913 29,778 1,703,782 2.199,983 2,381,437 2,671,412 2,737,544 3,313,505 0 44,795 449,124 57,999 116,202 573,157 44,611 96,959 581,715 30,510 131,547 615,618 36,284 114,508 625,326 10,122 138,599 769,398 12.024 167.949 40,787 56,878 41,140 49,490 220,674 73,988 230,097 109,581 373 263 341,100 Other Long-Term Assets, Total Deferred Charges Deferred Income Tax, Long Term Asset Restricted Cash, Long Term Other Long-Term Assets Total Assets Liabilities and Equities Liabilities Accounts Payable Accrued Expenses Notes Payable/Short Temm Debt Current Portion of LT Debt Capital Leases Other Current Liabilities Dividends Payable Customer Advances Income Taxes Payable Other Payables Discontinued Operations, Current Liability Other Current Liabilities Total Current Liabilities Total Long-Term Debt Long-Term Debt Capital Lease Obligations Deferred Income Tax Minority Interest Other Long-Term Liabilities Total Liabilities 191,865 455.233 12,807 23,888 11,638 335.696 99,402 142.730 6,452 21.833 17.920 19,624 151,956 6,486 22,937 13.900 25,802 30,871 8,201 48,052 36,819 7,235 35,031 15,591 13,926 31,204 44.238 0 10.702 71,404 732,681 279,625 279.625 0 76,901 82,762 865,457 923,561 321,563 452.586 321,553 452,430 0 158 20,482 15,723 3,705 4.207 116,213 147.872 1,327,409 1,543,949 135,750 151,012 295,970 302.735 993,936 1,070,494 1,156,295 1,432,195 546,071 505,104 608,292 611,995 545,164 504,414 605,752 611 528 908 690 540 488 26,850 45,440 11.740 61 258 4,298 4,328 4,532 5.251 257,547 258,512 378,000 248,528 1,828,711 1,881,887 2,156,9252,359,226 21,651 3.071 85,300 1,122,327 2012 2013 2014 2015 2016 2017 2018 Fiscal year ended March 31 in 2 millions) Shareholders' Equity Common Stock, Total Additional Paid In Capital Retained Eamings (Accumulated Deficit) Unrealized Gain (Loss) Other Equity. Total Translation Ad ustment Other Equity Minimum Pension Liability Adjustment Other Comprehensive Income Total Equity Total Liabilities and Shareholders' Equity 6,348 111.868 250,898 929 (43,057) (2.740) 0 (38.706) 6.381 6.438 6.438 6.792 6,792 6.792 113.288 116,831 114.898 188,874 188,919 188,919 342.854 476,758 455,627 609,838 617,960 746,948 328 229 (52,783) (61.522) (179,116) (36.280) (86,544) 55.781 28,548 45.542 (53,936) 47.880 (8,516) 77,469 29.450 48,522 (53,001) 46.212 0 0 (911) (1.027) (193) 228 (62,247) (75,684) 0 0 0 0 (15,781) 53.998 0 47 (742) 1,440 376,373 656,035 552,726 789,524 580.619 954 279 1,703,782 2.199,984 2.381,437 2,671,411 2,737,544 3,313,505 (1.612) 326,985 1.449,312