Business
Co raises capex to Rs 3,500-4,000 cr
Updated : Mar 19, 2018, 05:04 AM IST
Cyrus Mistry, chairman of Tata Motors, said the company's passenger vehicle division is currently undergoing a transformation and will take time to get on track relative to its commercial vehicle division.
"Behind all the figures in the balance sheet, clearly, India (operations) has not done well. I think we should not hide that, we should accept that," Mistry said responding to shareholders' concerns at the 69th annual general meeting of the company on Thursday.
"The market itself is not good, but Tata Motors's performance could have been better and we should accept that fact. There is a lot of work being done in terms of transformation, which will take time to take effect. So it's not going to happen today or tomorrow, this year is also going to be a challenge for us," he said.
Tata Motors will launch its new compact sedan Zest this month, which will be followed by a hatchback Bolt later this year. Mistry said the company would launch new vehicles every year.
In order to pursue the plan aggressively, he said the company would spend around Rs 3,500-4,000 crore capex this year, which is an increase from its earlier guidance of Rs 3,000 crore year. "This magnitude will continue over the next 3-4 years," Mistry said. JLR will spend about 3.5-3.7 billion pounds this year.
On rising competition in the market, Mistry said, "Last year, we saw from our competitors an intensity of launching new products, which we have never seen before. We have to understand that the competitive environment today is different from ever before in the past."
The current slowdown has impacted company's both CV and passenger vehicle volumes.
"CV will pick up faster than the passenger car market. It takes significant more time for us to implement our transformational exercise in the passenger market and CV is much more sensitive to industrial growth. We will see CV pick up faster with new government and new investments," he said.
On the issue of compensation revision for executive directors, he said the company was talking to shareholders.
A proposal for payment of minimum remunerations to three of its directors, including late Karl Slym, who served as company's managing director, and Ravi Pisharody, executive director for company's commercial vehicle business unit, was recently rejected by shareholders.