Ousted Tata Sons’ Chairman Cyrus P Mistry has sought the Supreme Court to compare the performances of the Tata Group during his tenure with the present, stating its net loss of ₹13,000 crore in fiscal 2019 was the worst loss in three decades.

Tata Sons has a 282 per cent increase in operating loss, up from about ₹550 crore in 2016 to about ₹2,100 crore in 2019. The standalone borrowing costs in Tata Sons rose by 92 per cent to ₹2,776 crore in 2019 from ₹1,453 crore in 2016, Mistry said in his submission before the Supreme Court.

Mistry was challenging a petition filed by Tata Group challenging his reinstatement order by the National Company Law Appellate Tribunal (NCLAT) in December 2019.

Post-Mistry, the Tata group-level debt rose by ₹80,740 crore in two years as compared with the debt increase by a comparatively lower figure of ₹69,877 crore over the previous four years. The conversion of Tata Sons into a private limited company would also cause the cost of debt to increase.

Employee expenses in the three years under Mistry’s chairmanship increased by ₹96 crore as against a ₹210- crore increase under the present management over a similar timeframe, it said.

During Mistry’s tenure, Tata Group had annually outperformed the BSE Sensex by 5 per cent in terms of market capitalisation. Likewise, an annual increase in Group companies’ net profits of 34.6 per cent during the three years and a 100 per cent rise in patent filings resulted in an increase in brand value by $5 billion.

In the submission Mistry alleged that the performance over the past three years was gauged using the same yardstick, and he was sacked terming “lack of performance”.

It also alleged that Tatas had sought to exclude the dividend received by Tata Sons from Tata Consultancy Services (TCS) to arrive at operating profit in a bid to discredit Mistry’s performance.

Key parameter

According to Mistry, a key parameter to evaluate an investment holding company such as Tata Sons is to review the investments made during the period under consideration.

In the last three years, Tata Sons invested about ₹67,000 crore in portfolio companies, while the value of these investments has already eroded by about ₹40,000 crore.

The value of the listed non-telecom investments during this period eroded by 23 per cent to ₹16,243 crore, while during the same period the BSE Sensex grew by 27 per cent, pointing to a 50 per cent underperformance to the index, it said.

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