Tata Group bets big on Africa

The Tata group is planning major expansion in Africa across various industry verticals so as to increase its current revenue of $2.3 billion from the continent by an annual average 30 per cent.

The group is looking at setting up new facilities or expanding business in mining, hospitality, automobiles, fertilisers and a host of other sectors, Tata Sons brand custodian and chief ethics officer Mukund Govind Rajan said.

He said the Tata group has so far invested $1.7 billion in Africa and has a presence in 20 African countries through nine different companies. The group had total revenues of $2.3 billion in 2011-12.

The group operates in Africa through Tata Africa Holdings, a wholly-owned subsidiary of Tata International.

Listing the various proposals, Rajan said Tata Motors is looking to set up new assembly facilities through local partners in countries like Tunisia and Kenya, while its hospitality chain Taj Hotels Resorts and Palaces is considering "proposals from three-four" countries to set up new properties.

"The business models which work in India can work in Africa and we would like to widen and deepen our business in Africa," he added.

Tata Motors international business (Commercial Vehicles Business Unit) head RT Wasan said the group currently operates an assembly unit in South Africa.

"We are looking at new assembly operations in Tunisia and Kenya through local partners. We are focusing on small, light and medium commercial vehicles," he said.

Tata Motors will also soon start bus body building in South Africa in partnership with its global partner Marcopolo, he said, adding that the company is also "evaluating" options for the Nano in Africa, although there are no plans for assembling passenger cars in Africa.

Tata Africa Holdings managing director Raman Dhawan said Taj Hotels Resorts and Palaces has a property at Lusaka in Zambia and Cape Town in South Africa.

"We are considering proposals from 3-4 countries. All of these properties may not necessarily be in the luxury segment but they would be appropriate for the African market," he added.

Dhawan said that sectors such as power, automobile, mining, and hospitality offer good business opportunity in Africa.

He also did not rule out the Tata group entering the hydrocarbon sector over the long term.

The Tata group, which entered Africa through its trading arm Tata International, in Zambia in 1977, today has nine companies, including Tata Motors, Tata Consultancy Services, Tata Communications, Tata Chemicals and Tata Power in the continent.

The group had total revenues of $100.09 billion (Rs475,721 crore) in 2011-12, of which 58 per cent came from business outside India, Dhawan pointed out.