After an abortive attempt to foray into the aviation sector in the mid-1990s, the Tata group has ruled out any immediate plans to enter the business.
MUMBAI: After an abortive attempt to foray into the aviation sector in the mid-1990s, the Tata group has ruled out any immediate plans to enter the business.
"We have no plans at present to enter the aviation business. However, this does not mean that we won't relook at the business in the future," a top Tata group official said.
The Tata group had announced its plans for the domestic airline business in the late-1990s in collaboration with Singapore Airlines but abandoned it following failure to obtain regulatory approvals.
"The market conditions then and those prevailing now are different. While I don't rule out entering the business in the future, I can tell you that we are not looking at the business now," Tata Sons' Executive Director, R Gopalakrishnan, said.
The Tata group has a long and distinguished connection with Indian aviation with its former Chairman, the late J R D Tata's love for flying and association with Air India, being a case in point.
Similarly, Rata Tata, the present Chairman, has never hid his love of flying. Recently, he co-piloted a fighter aircraft during the Bangalore air-show.
Speculation about the leading corporate entity entering the aviation business keeps cropping up often and most recently did so a few months back, when the Tata group took a stake in low-cost carrier SpiceJet.
It was then speculated that the Ratan Tata-led group was planning to enter the business piggy-backing on SpiceJet.
Dismissing the notion, Gopalakrisnan described the investment in the Delhi-based air-carrier as "purely a financial investment and nothing to do with us entering the business".
Putting the Tata brand at around USD 7.5 billion which positions it between 50-55 in the international league, Gopalakrishnan said that "there has been a very evolutionary development of the Tata brand".
"We have evolved and grown through dramatic moves and not through dramatic announcements," he said, citing the examples of the group's pioneering initiatives in the country's steel, hospitality, chemicals and lately its dramatic progress achieved in the IT and automobile sectors.
"People thought we were crazy when we announced our decision to set up our steel plant at Jamshedpur as also when we entered the hospitality sector through our Taj Hotel in the early-1900s," he said.
There was a lot of scepticism about the Indica car as well but now it has established itself firmly in the marketplace. "Similarly, when we come out with our Rs 1-lakh car, people will be amazed," he said.
Pointing out that the Tata group had come up with some huge project "every 20 years which has wowed people", Gopalakrishnan attributed this ability to the "distinct Tata entrepreneurship which is not attributable to a single person but comprises a distributed and sustained entrepreneurship."
The Tata group's philosophy is to be a long-term player in any business it enters in. "We don't look at valuations and then exit the business --we don't believe in this," Gopalakrishnan said.
Highlighting the group's attribute to slug it out over the long-haul, Gopalakrishnan said "despite problems, the group persists with the business and after persistence, assumes leadership position in the marketplace".
This helped the group build up a unique set of skills which the group then leveraged to enter adjacent businesses and grow, he said.
"Our DNA and brand is distinct which is what sets the Tata group apart from the rest and enabled it to remain the number one corporate house in India for well over 100 years."
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