Tatas Plan $8-billion Infra Push
After the country’s coming elections that will lead to a new wave of infrastructure development, Chairman of the Tata Group, Cyrus Mistry, is scheduling to spend at least $8 billion in building roads, airports and housing, betting a stable administration. In December 2012 after Ratan Tata’s two decades at the helm, Mistry, 45, took over as the group’s chairman is now escalating at least three unlisted infrastructure companies within the $100-billion multinational, as per two persons who are aware with his plans. The businesses will get more consideration after Mistry has passed operations at bigger, listed Tata companies, including the auto and steel units.
The scheme from Tata, which manage assets including Jaguar Land Rover and New York’s Pierre hotel, underlines the hope among Indian corporate that infrastructure project agreements and spending will pick up when a new government is formed after elections ending in mid-May.
He added, “Mistry looks at this sector as a phenomenal opportunity,” said UR Bhat, managing director of the India unit of UK-based Dalton Strategic Partnership, which manages $2 billion globally. “It’s a natural extension of their capabilities. Tata has the financial muscle to bid for the biggest of the projects and dominate.”
India needs to spend $2.2 trillion by 2030.
On urban transportation, housing and office space, India needs to spend $2.2 trillion by 2030 to boost infrastructure ranked below that of Guatemala and Namibia by the World Economic Forum, McKinsey said in a 2010 study.
At the close in Mumbai, the S&P BSE Sensex added 0.1% to 21,832.61. The S&P BSE Capital Goods Index declined 0.4%, paring its year-to-date gain to 13%. In June, Siddhartha Roy, Tata Group’s chief economic advisor told the reporters that from 2012 through 2017, India is likely to spend 41 lakh crore ($668 billion) on infrastructure with almost half of it being provided by the private sector.
Sarika Kapoor Chokshi, a Tata Sons spokeswoman in Mumbai told that Tata Housing Development, Tata Projects and Tata Realty and Infrastructure or TRIL, which constructs technology parks, malls and residential complexes, are among the infrastructure units that are targeting to more than triple their order books to 70,000 crore in five years.
In the next five years to build highways, airports, hotels and urban transportation, TRIL is planning to spend 22,700 crore, as per the presentation made by MD Sanjay Ubale last June. Tata Housing is budding 26 projects across 10 Indian states.
According to a familiar person, encouragement has been given to seek contracts abroad, particularly in western Asia and southern and western Africa by the Mistry.
The person said, as per the expectation of Tata management, infrastructure activity will expand in a year or two after a new Indian government spurs an economic rebound. In the final 3 months of 2013, India’s growth slowed to 4.7%, idling below 5% for the seventh straight quarter and denting the Congress party’s chances of extending its decade-long rule in national elections that start next month and conclude in mid-May.
Source: The Times of India
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