The Tale of Tata: How a Trading Firm Became a Global Giant

In 1868, Jamsetji Tata set out with ₹21,000, a sum that might sound small today but sparked one of the biggest business empires in history. Today, it is a global conglomerate with over ₹13 lakh crore in revenue as of FY24, spanning 100 countries in 6 continents. The group boasts a total of 30 companies, 26 of which are listed, including TCS, Tata Motors, and Titan, and employs over 10 crore people.

For over 150 years, Tata has been an influential force in shaping industries and communities.  With a presence in 10 diverse sectors, including steel, automotive, hospitality, IT, chemicals, and even e-commerce, Tata stands as one of the world's most expansive and influential businesses.

But how did the Tata empire come to be? It was just built on more than numbers, profits, and acquisitions. Let's take a closer look at this journey and find out how a textile company became a global conglomerate.

Modest Beginnings: Tata's Founding Story

He believed business shouldn't just chase profits but should also uplift society.

His first big move? Setting up a cotton mill in Nagpur in 1877. To Jamsetji Tata, the textile industry was not just a business; it was a medium to enhance India’s industrial prosperity. During his foreign trips, he became increasingly convinced of the vast potential for Indian companies to challenge the British stronghold over the textile market.

From 1880 to 1904, Jamsetji had 3 massive dreams for India which were way ahead of its time:

Steel Plant:

Jamsetji Tata recognised the critical role that steel would play in nation-building and economic development. Inspired by a lecture he attended in 1867, where British essayist Thomas Carlyle stated that “the nation which gains control of iron, soon acquires control of gold,” Tata was determined to establish a steel industry that could support India's burgeoning infrastructure needs.

The outcome was the establishment of India's first integrated steel plant Tata Iron and Steel Company (TISCO) in Jamshedpur. This plant was not merely a business venture; it represented a significant leap toward industrial self-sufficiency for India.

Reliable Electricity:

“We must harness this water. We must turn it into power.”

On his trip to the Western Ghats, Jamshetji was inspired by the flow of natural water sources in the form of rivers. He envisioned sparks generating from the flow and hence started Tata Hydroelectric Power Supply Company in 1910.
Recognising the importance of reliable electricity for industrial growth, Jamsetji Tata envisioned a future where power would be accessible to fuel India’s development.

World-Class Education:

Jamshetji Tata had the vision of nation-building through educational upliftment. He realised that upskilling and informing the youth about the different processes (both practical & theoretical) would boost the nation’s growth.

Hence, he made it his mission to contribute towards educating the masses, especially the ones who don’t have the resources to pay for it. He started by founding an institution and went up to forming trusts and sponsorship programs throughout the country.

This practice is being followed after decades of the Tata Group’s foundation presenting strong founding ideals.

It is no surprise that Jamsetji Tata is fondly remembered as the "Father of Indian Industry". His approach was clear: businesses should give back. That's why much of Tata's profits are reinvested into trusts.

Tata Memorial Centre (1941), Udaan, Lakhpati Kisan & MKRISHI are just some of Tata’s philanthropic initiatives. Today, over 66% of Tata Sons' (Tata's holding company) equity is held by philanthropic trusts, making Tata Group a global leader not just in business but in giving back. Even though Jamsetji passed away in 1904, his ideas lived on through his son, Dorabji Tata.

By the early 1900s, under the leadership of  Dorabji Tata, the group ticked off some major milestones:

Tata Iron and Steel Company or TISCO (1907):

The establishment of India's first integrated steel plant worked phenomenally for the group and is now one of the top steel producers in the world. Yes, we are talking about Tata Steel (renamed in 2005) which is churning out a revenue of ₹2.29 lakh crore for FY24 and contributes over 25% in the group’s revenue generation.

Inspired by the changing global trends and a heartiest wish to contribute to the Swadeshi Movement, Tata Steel was formed. He recognised that steel was foundational to industrialisation and essential for building infrastructure, machinery, and transportation systems.

The firm is not only limited to big factories. A less-known fact is that Tata Steel UK’s coin currencies (including 1, 2, 5 and 10 penny coins) are made of Tata Steel. That’s not all! The Tata Group has been a cornerstone of India's development, influencing everyday life through its diverse contributions across various sectors:

• Landmark projects like Kolkata's second Hooghly Bridge and Mumbai's Bandra-Worli Sea Link.
• Every third tyre manufactured in India belongs to the company.
• Two-thirds of India's metro rails, flyovers, and bridges were constructed by Tata Steel.
• One in every two LPG cylinders used for cooking is made from Tata steel, making it a crucial part of daily life for many households.

All these aspects and more make Tata Steel the largest steel company in India, with an annual capacity of 21.6 million tonnes. The company is also the nation's top steel exporter, with a record of 14 million tonnes of steel exported in FY24.
Guess how much steel would it be? You can build at least 100 Eiffel towers (or even more) from it. 

Know the latest updates on Tata Steel Ltd., like Share Price Today, Market Cap, Price Chart, and Balance Sheet.

Tata Power (1911):

It kicked off with hydroelectric plants and is now India's largest private power company, with a reported revenue of ₹61,542 crore for FY24. Today, Tata Power leads the industry in clean and sustainable solutions with 30% of clean energy generation locked in its portfolio.

The company is now transitioning into the EV sector by establishing the first set of Electric Vehicle charging stations in Mumbai.

Know the latest updates on Tata Power Ltd., like Share Price Today, Market Cap, Price Chart, and Balance Sheet.

Taj Mahal Palace Hotel (1903):

The stories behind Tata’s entrance into the hotel chain business are many but the one anecdote that stands out is the Watson Hotel visit. It is said that Jamshetji Tata was denied entry to Watson's Hotel, which was exclusive to Europeans. That’s right! Even major personalities like Tatas faced racial discrimination.

So, to create a luxurious place for people from all races and classes, the Taj Mahal Palace was founded and opened in 1903. Today, way ahead in a century, the hotel is not just one of the top hotels in the world but a destination in itself.

Today, the Taj Hotels chain boasts over 350 hotel properties in 13 countries, redefining luxury hospitality. Tata's Indian Hotels Company Limited (IHCL), which includes the Taj Mahal Palace Hotel, announced a revenue of ₹6,952 crore in FY24.

These weren't just business ventures— they were nation-building projects. Today, these three companies are the pillars of the company and contribute the most to its overall success and growth.

Tata Chemicals (1939):

Eager to start a soda ash plant in India, Kapil Ram Vakil, a chemical engineer, approached Tatas for funds. The company already had a reputation of being innovative and experimental and hence decided to try their luck into yet another new industry.

In this way, Tata Chemicals was formed in 1939 which was also India's first industrial chemical manufacturer. The company’s salt works were the largest in India and the second largest globally.

However, the low entry barriers made this sector appealing, particularly to regional competitors. In the soda ash market, the company emerged as the lowest-cost producer, successfully maintaining operations despite the challenge of inexpensive imports. In the salt industry, it continued to hold a leading position in the marketplace.

This was the company that brought fertilisers to India, helping farmers boost crop yields. Today, Tata Chemicals operates in over 40 countries and still produces iconic products like Tata Salt, a staple in crores of Indian homes.

Know the latest updates on Tata Chemicals Ltd., like Share Price Today, Market Cap, Price Chart, and Balance Sheet.

Tata Motors (1945):

Every one out of three school buses in India belong to Tata Motors and so the automotive world would never be the same. Started as a locomotive manufacturer in 1945, Tata group soon formed a JV with Mercedes-Benz of Germany. This all happened in the 1950s. Tata Motors entered the market with India's first homegrown car, marking the company as a national icon.

But Tata wasn't stopping there. It continued to innovate, and in 2008, Tata Motors shook the world by acquiring Jaguar Land Rover.

Now, it generates over ₹4.3 lakh crore in revenue, contributing 39.04% to the Tata Group. This makes it the top revenue-generating company under Tata.

Know the latest updates on Tata Chemicals Ltd., like Share Price Today, Market Cap, Price Chart, and Balance Sheet.

TCS (1968):

Taking Jamshteji Tata’s belief in Indian's skill, the group planned to enter the untouched grounds, aka IT sector. Seeing the growing demand for IT professionals and tech solutions, Tata wished to train & retain India’s talent in the nation’s growth.

Hence in 1968, Tata launched Tata Consultancy Services (TCS), India's first IT services company. Today, TCS is a global IT giant, generating over ₹2.4 lakh crore in revenue. The company now handles India’s biggest entrance exams in its platforms including the IIMs and IITs.

The 1990s were a pivotal decade for Tata, with the group continuing to diversify into telecommunications, chemicals, power, and more. By then, Tata Group was firmly cemented as one of the cornerstones of the Indian economy. The conglomerate has made outstanding innovations in every crucial sector.

The economic implications of Tata's contributions are also profound. The organisation supports the backbone of India's banking system by powering the digital networks of over 100 banks, including the State Bank of India (SBI).

By the 1990s, Tata had become a worldwide name. Post liberalisation strikes and the conglomerate decided to cross the national boundaries and make its presence known worldwide. Their plan? Bold moves, smart buys, and staying true to Tata’s values of doing good without compromising the business.

Tata's first major international acquisition was Tetley, the British tea company, in 2000. He acquired Tetley (a company 3 times its size) for ₹3,825 crore ($450 million), making Tata the second-largest tea producer in the world. In fact, over the years, Tata has made many international acquisitions, and as a result, it has significantly expanded its global presence across various industries.

In 2007, Tata Steel made a jaw-dropping move when it acquired the UK-based steelmaker Corus for ₹10,080 crore ($12 billion). This made Tata Steel the fifth-largest steel producer in the world. I mean, wow. Talk about taking your business to the next level.

And under his leadership, Tata's revenue jumped from ₹3,360 crore in 1991 to ₹84,000 crore in 2012.

While the story of how Tata became an empire with more than ₹30 lakh core is fascinating, we have only talked about the companies and the men behind them. Tata has always been about more than just building big businesses. It has focused on coming up with fresh ideas and doing things differently.

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The Bottom Line

Tata has always been all for innovations, making it one of the first firms to experiment in new ventures. The group’s history from automotive to chemicals explains it all. In the present, Tata Group is entering the digital, tech-savvy world with development in EV & AI sector.

So, what's next for Tata? If history has taught us anything, it's that this empire isn't slowing down anytime soon. From Jamsetji's dream of a steel plant to Ratan Tata's bold global acquisitions, the Tata Group continues to innovate, diversify, and expand.

So, what do you think? Is Tata's blend of business and philanthropy the way forward for other companies? Or do you think the next big thing for them will be something we haven't even imagined yet? Drop your thoughts below!

*Disclaimer: The stocks, companies, and policies discussed above aren't recommendations from Finology Insider and shall not be construed as a replacement for professional advice. Consult a professional or conduct the necessary research before making investment decisions.