Cyrus Pallonji Mistry was removed from his position as chairman of the $100 billion conglomerate Tata group on Monday. Former spearhead Ratan J. Tata has been appointed as the interim chairman of the group and a selection committee has been formed to choose Mistry’s successor. The appointment committee has been accorded a time period of four months to complete the task as per the company’s article of association.
WATCH VIDEO: Cyrus Mistry’s Career Timeline
Mistry holds a BE in Civil Engineering from the prestigious Imperial College in London. He followed it up with a M Sc in Management from London Business School and a Bachelor of Commerce from Mumbai University.
Son of Pallonji Mistry, Cyrus served as the managing director of Shapoorji Pallonji Group from 1994-2011. During the same time he was involved with Tata group in various capacities till he was appointed as Deputy chairman of the group in 2011 and as chairman in 2012 as the successor of Ratan Tata.
Cyrus was also seen as the natural heir to the Tata group as his billionaire father owns an 18.4 percent stake in Tata group, largest stake of any shareholder in the group.
Here are the key decisions Mistry took during his time at the Tata group at the helm:
According to Mistry himself, over the last three years, the operating cash flows of Tata group grew by over 30 percent CAGR. However, he reformed business practices in the group mandating the requirement for group companies to earn the right to be part of the portfolio and also earn “the right to grow”.
During the same period, the company’s gross debt increased by 2 per cent due to increased cash and capital expenditure from projects but at the same time the cash and equivalent assets grew at around 10 per cent. The net debt of the group also decreased by 3.3 per cent during the time, so Mistry’s tenure saw reduction in debt strain on the company.
He pruned several companies from the portfolio and even changed the structure of the company’s hospitality arm from owning properties to one managing properties across the globe. A huge 70 per cent of the group’s revenue comes from abroad. A majority of the group’s capital expenditure under Mistry has been abroad.
Grasping the need to expand the company’s digital signature in the industry, apart from having the hugely successful TCS, Mistry added the digital platform–CliQ- an ecommerce platform. He also added Tata iQ which is a big data company and is rapidly growing in the field of data analytics. Finally, the group added Tata Digital Health which expanded the group’s medical business forays into e-healthcare and telemedicine taking medical care beyond physical impediments. TCS doubled its profits during the time overshadowing all competitors.
In pruning measures, Mistry was also involved in prospective selling off of long products businesses like the ailing Tata Steel in Europe due to drop in demand and massive competition from cheap Chinese supply. Also during his time, Tata teleservices failed to come out of its negative networth.
After Mistry took the position, Tata Motors focused on passenger vehicles section aiming for two launches every year. This has in turn changed customer perception about the company and lifted Tata Motors’ sales.
The group under Mistry has also tried to expand its business in the defence manufacturing business with several key contracts in the pipeline. Material sciences has been a major fillip to their defence manufacturing business during this time.