Mumbai: Corporate icon Ratan Tata on Friday retired as Chairman of Tata Group after a 50-year run predicting that India's growth will reestablish after the 'passing phase' of a difficult environment, which will most likely continue in the next year.
Cyrus Pallonji Mistry, 44, unanimously named a year ago as Tata's successor by the board of Tata Sons, the holding company, will take over the reins Saturday as the sixth chairman of the group, which was established in 1868 by Jamsetji Nusserwanji Tata.
Turning 75 today, he kept away from the Bombay House headquarters of the USD 100 billion group but instead spent time with employees in the manufacturing facilities of Tata Motors in Pune.
"At the request of the union, I spent the day - my last day prior to retirement, in the Tata Motors' various manufacturing facilities at Pune to say farewell to my shop floor colleagues. We have been together in good times and bad and have gained closeness based on mutual trust," he tweeted.
He said in his twitter message that going to the plants and receiving greetings from so many colleagues is a great emotional experience.
"I have been deeply moved by the sincerity and spontaneity of their greetings. I will always carry memories of this day with me through the rest of my life," Tata said.
In a farewell letter to all the employees, he asked the employees to live by the value systems and ethical standards the group had followed all along.
Cyrus Mistry visited the office today. He chose group company Tata Motors' sedan Indigo Manza to travel to work on a day that marked an end of an era.
The narrow lane leading to Bombay House, one of the oldest buildings in the heritage Fort area of south Mumbai, had heavy media presence since morning in anticipation of Tata visiting Bombay House.
In his letter to employees, Tata asked his colleagues to show their "support", "commitment" and "dedication" to achieve success in these somewhat difficult times.
"The difficult economic environment that we face in the current year will most likely continue through most of the next year. We will probably see continued constraints in consumer demand, over-capacity and increased competition from imports," he said.
Tata said there will therefore be great pressure on Tata companies to reinvent themselves in terms of business processes and to dramatically reduce costs, to be more aggressive in the market place and to widen their product range to better address consumer needs.
"We will also need to contain our borrowings and work hard to retain our margins. This environment would once again call on you for your support, your commitment and your dedication to achieve success in these somewhat difficult times," he said.
Tata said the seemingly gloomy picture, however, will be a passing phase.
"I feel confident that the robust growth that India has shown over the past several years will be re-established and the strong fundamentals in the country will result in India once again taking its place as one of the economic success stories of the region," he said.
Tata, who helmed the group for 21 years after being chosen successor by his uncle, the iconic JRD Tata, in 1991, is credited with transforming the group through bold decisions including large global acquisitions, even as some of its peers struggled to stay relevant post economic liberalisation.
Mistry, who has been with the group since 2006 in various capacities hails from the Shapoorji Pallonji family, the largest private share holder of the group's holding company Tata Sons.
Born on July 4, 1968, Cyrus Mistry completed his graduation in Civil Engineering from London's Imperial College of Science, Technology and Medicine and followed it up with a masters in Management from the London Business School.
He was chosen by a five-member panel last year to succeed Ratan Tata.
During Tata's tenure, the group's revenues grew manifold, totalling USD 100.09 billion (around Rs 475,721 crore) in 2011-12 from a turnover of a mere Rs 10,000 crore in 1991.
Tata led the group into some notable acquisitions, starting from Tetley by Tata Tea for USD 450 million in 2000, to steelmaker Corus by Tata Steel in 2007 for GBP 6.2 billion and the landmark Jaguar LandRover in 2008 for USD 2.3 billion by Tata Motors.
Courtesy the acquisitions, over half of the salt-to-software group's revenues are derived from outside the country.
Not limiting himself to big-ticket acquisitions, Tata also displayed sensitivity to the needs of the burgeoning middle class with the launch of the Rs one lakh Nano battling the odds in West Bengal.
The group was forced to shift the project from Singur, where he was invited by Marxist Chief Minister Buddhadeb Bhattacharya, to Sanand in Gujarat at the invitation of Narendra Modi.
Although Nano has not been able come up to the expectations after its initial worldwide acclaim, the small car will still be remembered as Tata's desire to provide a "safer" option to many Indian lower-middle class families riding two-wheelers.
In a recent interview to PTI, Tata has said that Singur was a "great disappointment" because he went there "in a leap of faith" thinking that part of the country was being ignored industrially. Tatas will still go to West Bengal some day, he has said.
Under Tata, the group also made great strides when it capitalised on the sunrise industry of information technology in the 90's. With revenues of over USD 10 billion in 2011-12, Tata Consultancy Services (TCS) is today India's largest IT company, ahead of giants in the field like Infosys and Wipro.
On his post-retirement plans, Tata, a bachelor, has said he will spend time on technology which is quite a passion with him. He will brush up on his piano, which he learnt as a school boy and pursue flying, apart from his focus on philanthropic activities.