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Offering at the lotus feet of our master

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3

India: Fastest Growing Free Market Democracy

GDP Growth Forex FII Flow FDI Per Capita Inflation

1990 4.9 % < USD 1

billion

USD 1 million

(1993)

USD 97

millionUSD

390

9 percent

2008 8.7 %* USD 309

billion as on

Mar 28, 2008

USD 16.1

billion in 2007-

08

USD 12.7 billion

in 2007-08 till

December (USD

16 billion in2006-07)

USD

740

7.8 percent

as on

March 29,

2008

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4

India: Vibrant Economy Driving M&A Activities

Growth Drivers: Globalisation and increased competition

Concentration of companies to achieve

economies of scale

Cash Reserves with corporate

Number of Deals and Value

28.2

70

18.3

12.3

782

1,081

467

306

0

10

20

30

40

50

60

70

80

2004 2005 2006 2007

U S D B i l l i o n

0

200

400

600

800

1,000

1,200

N u m b e r o f d e a l s

Deal Value No. of Deals

Private equity deals value

increased to USD 19 billion

In 2007, there were a total of 676 M&A deals

and 405 private equity deals

Total M&A deal value was

close to USD 51 billion

Trends: Cross-border deals are growing faster than

domestic deals

Private Equity (PE) houses have funded

projects as well as made a few acquisitionsin India

In 2007, the total value of M&A and PE

deals was USD 70 billion

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5

BRIC Report,

Goldman

Sachs

I have never seen

India so dynamic,vibrant and full of

business

opportunities.

- Dan Scheinman, Cisco

System Inc. as told to

Business Week, August

2005

We came to India for

the costs, stayed for the

quality and are now

investing for

innovation.

John Redwood

Economic

CompetitivenessPolicy Group, UK

India is now truly

a land of

opportunity.

Jack WelchGeneral Electric

India is a developed

country as far as

intellectual capital is

concerned.

Peter Loescher

President and

Chief ExecutiveSiemens

By 2032, India will be

among the three

largest economies inthe world.

Why India? ± Quote Unquote

T ravyn

Rhall,

ACNielsen

The Indian market has two

core advantages - an

increasing presence of

multinationals and an

upswing in the IT exports.

Craig Barrett

Intel

Corporation

India has evolved

into one of the

world's leadingtechnology

centers.

Mr Paul de Voijs

Managing Director Volvo Car India

India is a very

exciting market and

the luxury car

segment is growing

exponentially here.

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6

Major M&A Deals Undertaken Abroad by India Inc.

USD 12.1

billion

USD 12.1

billionTata Steel buys Corus Plc

Tata Steel buys Corus Plc

USD 6 billion

USD 6 billionHindalco acquired Novelis Inc.

Hindalco acquired Novelis Inc.

USD 2.3

billion

USD 2.3

billionTata buys Jaguar and Land Rover

Tata buys Jaguar and Land Rover

USD 1.6

billion

USD 1.6

billionSuzlon Energy Ltd. acquires

REpower

Suzlon Energy Ltd. acquires

REpower

USD 1.58billion

USD 1.58billionEssar Steel acquired Algoma Steel

Essar Steel acquired Algoma Steel

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7

Major M&A and Investments Announcements in India (1/2)

USD 11 billionUSD 11 billionVodafone buys HutchVodafone buys Hutch

USD 1.7

billion

USD 1.7

billionPlans to spend on its development

operations in India over the next four years

Plans to spend on its development

operations in India over the next four years

USD 2 billionUSD 2 billionPlans to establish three manufacturing

plants to produce photo-voltaic units

Plans to establish three manufacturing

plants to produce photo-voltaic units

USD 12 billionUSD 12 billion

POSCO to invest in building steel

manufacturing plants and facilities in Indiaby 2016

POSCO to invest in building steel

manufacturing plants and facilities in Indiaby 2016

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8

USD 0.98

billion

USD 0.98

billionAditya Birla Group increased its stake in Idea

Cellular by acquiring 48.14-percent stake

Aditya Birla Group increased its stake in Idea

Cellular by acquiring 48.14-percent stake

USD 1 billionUSD 1 billionPlans investment in private equity, real

estate, and private wealth management

Plans investment in private equity, real

estate, and private wealth management

Mylan Laboratories acquired a majority

stake in Matrix Laboratories

Mylan Laboratories acquired a majority

stake in Matrix Laboratories

USD 0.74

billion

USD 0.74

billion

Major M&A and Investments Announcements in India (2/2)

USD 1 billionUSD 1 billionPlans investment in private equity inIndian markets

Plans investment in private equity inIndian markets

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In the year 2008

� M&A deals in India in 2008 totaled worth

USD 19.8 bn

� Less compared to last year which stood at33.1 bn $.

� Decline of M&A activity was in line with the

global activity.

� Cross border M&A totaled 8.2 bn $ compared

to 18.7 bn $.

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THE DEALuuuuuu

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Ford Motors Company

�Location: Dearborn,Michigan

�Founded: 1903 by Henry

Ford�Competitors: GeneralMotors, Toyota

�Brand names: Lincoln,Mercury, Volvo, Mazda,Jaguar and Land Rover

�CEO: Alan Mulally Henry Ford and his Model T

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Firsts in history

1913 - Assembly Line

³low priced, mass-produced automobile withstandard interchangeable parts.´

� Hiring of African Americans

� Virtual manufacturing

� Focus on safety

� Advantage through fuel efficiency

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Company Quote Change %

Change

Market

Cap

P/E Ann.

Revenue

Ann. Net

Income

Toyota Motor Corporation

100.56 -3.16 -3.05 181.51B 9.16 234,033.65 16,066.36

Daimler AG 78.29 -1.31 -1.65 79.38B 13.03 158,080.17 7,711.65

Honda Motor Co., Ltd.

31.10 -1.20 -3.72 56.41B 7.86 108,349.45 5,788.49

Nissan Motor

Co., Ltd.

17.07 -0.73 -4.10 34.91B 8.58 100,257.66 4,413.04

PACCAR Inc. 46.72 -3.32 -6.63 17.12B 14.22 15,221.70 1,227.30

Ford Motor Company

7.65 -0.08 -1.03 16.83B - 172,455.00 -2,764.00

General Motors

Corporation

20.51 -0.76 -3.57 11.61B - 181,122.00 -43,297.00

Top Seven Auto and Truck Manufactures Organized by Market

Capitalization As of April 22, 2008

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Jaguar: The ups and downs

� 1922 - Founded in in Blackpool as Swallow

Sidecar company

� 196

0 - Jaguar name first appeared in 1935

� 1975 - Nationalized in due to financial

difficulties

� 1984

- Floated off as a separate co in the stockmarket

� 1990 - Taken over by Ford

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Jaguar: The ups and downs

� A statement of ultra luxury

� Holds Royal warrants

� Rarely advertised� Fords formula one entry since 1990s

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The case of Land Rover

� 1948: Land Rover is designed by the Rover Car

co

� 1976

: One millionth Land Rover leaves theproduction line

� 1994: Rover Group is taken over by BMW

� 2000: Sold to Ford for £1.8

billion

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The case of Land Rover

� Known for superior off-road performance

� Used by military for projects and expeditions

� Safe but less reliable� Makeover in recent times

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The Deal Process

� 12/06/2007- Announcement from Ford that it

plans to sell Land Rover and Jaguar.

� August 2007 - Major bidders are identified

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The Deal Process

Likely buyers

� Tata Motors

� M&M� Ceribrus capital Management

� TPG Capital

� Apollo Management

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The Deal Process

� Indias Tata Motors and M&M arrive as top

bidders ($ 2.05b & $ 1.9b)

� 03/01/2008 Ford announces Tatas as the

preferred bidders

� 26

/03

/2008

- Ford agreed to sell their JaguarLand Rover operations to Tata Motors.

� 02/06/2008 The acquisition is complete

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TATA MOTORS A SNAPSHOT

� TATA GROUP 150 YEAR OLD

� Previously Tata Engineering and Locomotive

Company,Telco

� Tata Motorss break-even point for capacity

utilization is one of the best in the industry

worldwide

� listed on the New York Stock Exchange in 2004

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Making Waves Internationally

� NANOwill mark the advent of India as a globalcentre for small-car production and represent avictory for those who advocate making cheap goods

for potential customers at the 'bottom of thepyramid' in emerging markets.

� International praise came from Standard & Poors,which in December 2006 expressed the view that the

policy to support its companies and the improvedfinancial profile of its entities also enhances theoverall financial flexibility of Tata Motors.

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Key issues

� Ford acquired Jaguar for $2.5 billion in1989.

� Ford acquired Land Rover for $2.75billion in 2000.

� But the US auto major put the twomarquees on the market in 2007 after posting losses of $12.6 billion in 2006 - theheaviest in its 103-year history.

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Fords standpoint.

� Tony Woodley, joint head of Britain's biggest trade union says:

� Unite on the takeover.

� 'But with the commitments the Tatas have given to the future of Jaguar-Land Rover and the long-term supply agreements for components, we're obviously pleased.

� Jaguar's sales fell 19% to a little below 60,500 units in 2007. ButFord says that is mainly due to the phasing out of the S-type, which

the company stopped selling from September, and the slowdown inthe US, where it sells around a third of its total volume.

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Why is Ford selling?

� Reports said losses at Jaguar stood at USD 715 million in 2006. jaguar has been a dog i.e. it has not been able to provide any profitfor ford because of the high manufacturing costs provided in theunited kingdom.

� The strong boy Land Rover's profit, on the other hand, was drivenby the record sale of 2.26 lakh vehicles, an 18% YoY growth in2007..

� Bringing down production costs and turning around the companysuccessfully, will be the challenge,´ analysts said. It¶s a test thatFord failed.

� Ford is combining both the brands since the products andmanufacturing of vehicles for Land Rover and Jaguar is sointertwined.

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Why acquire JLR?Is TATA catching a falling knife«or

� Long term strategic commitment to automotive sector.

� Opportunity to participate in two fast growing autosegments.

� Increased business diversity across markets andproducts.

� Land rover provides a natural fit for TML¶s suv segment.

� Jaguar offers a range of ³performance/luxury´ vehicles to

broaden the brand portfolio.� Benefits from component sourcing,design services and

low cost engineering.

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Tata and the dream

NEED FOR GROWTH

� In the past few years, the Tata group has led the growing appetite amongIndian companies to acquire businesses overseas in Europe, the UnitedStates, Australia and Africa - some even several times larger - in a bid toconsolidate operations and emerge as the new age multinationals.

� Tata Motors is India's largest automobile company, with revenues of $7.2billion in 2006-07. With over 4 million Tata vehicles plying in India, it is theleader in commercial vehicles and the second largest in passenger vehicles.

COMPETITIVE ADVANTAGE

� Tata Motors is vulnerable to greater competition at home. Foreign vehicle

makers including Daimler ,Nissan Motor ,Volvo and MAN AG have strucklocal alliances for a bigger presence.

� Tata Motors, which has a joint venture with Fiat for cars, engines andtransmissions in India, is also facing heat from top car maker Maruti SuzukiIndia Ltd , Hyundai Motor , Renault and Volkswagen

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Analysts pick

� Analysts indicate that Tata Motors can comfortably finance the acquisition of Jaguar and Land Rover. The Indian automaker is sitting on a cash pile of over Rs 6,000 crore and generated free cash of over Rs 1,000 crore duringFY07. It can easily use these reserves to raise more funds withoutendangering its finances. At the end of last financial year, Tata Motors¶ debt-

to-equity ratio was a low 0.56, giving it ample head room to raise morefunds.

� Over the next 3-4 years, Tata Motors plans to invest Rs 12,000 crore insetting up new units for a small car, trucks and SUVs and also to expandthe capacity of its existing units.

� challenge for Tata Motors. These marquee brands have very high

production costs and require phenomenally high engineering and researchcapabilities as they compete with likes of BMW and Audi. ³Taking over thebrand is easy, bringing down production costs and turning around thecompany successfully, will be the challenge,´ analysts said. It¶s a test thatFord failed.

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WHAT IS TATA PAYING FOR ????

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FINANCING WAYS

� Low leverage of the auto biz provides fundingflexibility

� Current ly financed the purchase through a

$3bn, 15month bridge loan It intends to refinance the loan through

long-term funds

� valuable stakes in group companies

owns $400m of Tata Steel at current pricesowns stake in Tata Sons (Tata Groups holding

company) worth at least $600m

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KEY ASSUMPTIONS

KEY ASSUMPTIONS

GROWT

H RAT

E 0.09

Terminal Growth Rate 0.03

EBIT as % of SALES 0.069

Discount Rate 0.06

JLR Shareholders Equity 2,456

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Result

� ACTUAL 2.3 BILLION RUPEES

� VALUATION 2.80 BILLION RUPEES

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JAYAKRISHNASUBRATPHANEENDRA

MADHUSUDANRANJAN

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6153427 tata jlr final

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