HUMAN RESOURCES
The Tata Motors Group employed 66,593 permanent employees (previous year: 62,873 employees) as of the year end, out of which 59,535 employees were engaged in automotive operations. The Company employed 29,566 permanent employees (previous year: 30,334 employees) as of the year end. The Tata Motors Group has generally enjoyed cordial relations with its employees and workers.
All employees in India belonging to the operative grades are members of labour unions except at our Sanand and Dharwad plants. All the wage agreements have been renewed in a timely manner and are all valid and subsisting. Operatives 'and Unions' support in implementation of reforms that impact quality, cost erosion and improvements in productivity across all locations which is commendable.
Safety and Health – Performance and Initiatives
The Company provides a safe and healthy workplace for its employees by establishing the right safety culture across the organization. The senior leadership is fully committed to the ultimate Goal of zero injury to its employees and all stakeholders who are associated with the Company's operations. Emphasis is laid on creating a participatory safety governance model. Safety and Health Environment (SHE) Councils have been formed for both Commercial Vehicle business and Passenger Vehicle business. The Company has come up with Safety Manual for Fully Built Vehicle (FBV) Application Vendors. The Lost Time Injury Frequency Rate (LTIFR) for this year is 0.39%, a reduction of 44% over FY 2012-13. Training and awareness among all concerned has been a key element of the strategic initiative. 5,07,738 man-hours of training have been spent on Safety. The Company has launched a campaign 'i-drive safe' - A Tata Motors initiative on building a safe driving culture and also training of driver employees with an awareness that the main risk is related to road safety and thereby ensured safe driving behavior of the drivers. The Company launched health brand logo 'HealthPlus - Because you matter!' to drive employee health initiatives. Series of initiatives like awareness sessions, mailers, etc. have been conducted under this initiative. The Company has come up with a Health and Wellness manual.
The Jaguar Land Rover business has recently restated its commitment of Safety and well-being. The philosophy of this commitment states that the company strives to continuously improve working conditions and promote safe working practices to ensure the safety and well-being of its employees and the wider communities which it engages with. 2013 saw the launch of Jaguar Land Rover's strategic direction on Safety and well-being, Destination Zero - A Journey to Zero Harm. The activities to deliver Zero Harm are underpinned with everyone understanding and taking a responsibility for their own and their fellow workers safety and well-being. Health promotion activities take place at all Jaguar Land Rover locations, the active use of 'WellPoint Kiosks' during FY 2013-14 was well received.
At TDCV Korea, the accident rate was 1.23% as against 0.18% achieved last year. The increase in accident rate is on account of Muscular Disease which TDCV is incorporating from this year as directed by government body. The safety index was 2.74 against 2.09 achieved last year. TMTL, Thailand, completed more than two years of accident free operations. Safety Assessment and Safety Training (on Safety Observations and Leading Safety Efforts) were conducted in Korea and Thailand in June 2013. At TMSA, South Africa, a comprehensive Health & Safety Manual was released, which had the Health & Safety policy, all SOP's (Standard Operating Procedures), contingency plans, etc. for TMSA. Safety audits have been initiated with involvement of management employees which is being conducted by an external agency, NOSA.
The Company has continuously endeavoured towards improving gender diversity and creating a safe, just and fair workplace for its employees. The "Sexual Harassment Avoidance and Redressal Policy (SHAR)" of the Company is in line with the Tata Code of Conduct and under this Policy an Apex committee at the corporate centre and location specific committees at local level, have been formed with set guidelines to address issues of sexual harassment at the work place towards any woman associates. The Company is committed to providing equal opportunities without regard to their race, caste, sex, religion, colour, nationality, disability, etc. All women associates (permanent, temporary, contractual and trainees) as well as any women visiting the Company's office premises or women service providers are covered under this policy. All employees are treated with dignity with a view to maintain a work environment free of sexual harassment whether physical, verbal or psychological.
During the year FY 2013-14, the Company has received 20 complaints on sexual harassments and of which 19 were disposed off. 17 cases from these have been substantiated and appropriate action taken. 32 workshops or awareness program were carried out against sexual harassment.
FINANCE
During the year, the free cash flows for Tata Motors Group were Rs.9,226 crores, post spend on capex, design and development of Rs.26,925 crores. Tata Motors Group's borrowing as on March 31, 2014, stood at Rs.60,642 crores (FY 2012-13: Rs.53,716 crores). Cash and bank balances and investments in mutual funds stood at Rs.39,206 crores (FY 2012-13: Rs.28,624 crores). With healthy profitability and cash flow generation, the Consolidated Net Automotive Debt to Equity Ratio stood at 0.07:1 as on March 31, 2014, as compared to 0.24:1 on March 31, 2013.
Cash flows from operations were Rs.2,463 crores for standalone operations of the Company. Spend on capex, design and development were Rs.3,094 crores (net). The borrowings of the Company as on March 31, 2014 stood at Rs.15,053 crores (FY 2012-13: Rs.16,799 crores). Cash and bank balances and investments in mutual funds stood at Rs.226 crores (FY 2012-13: Rs.822 crores).
During the year, the Company issued notice on April 16, 2013 to the holders of 4% Foreign Currency Convertible Notes, giving them time till June 10, 2013, to elect at their option to either convert the bond into equity or to receive redemption proceeds as per the terms of the indenture. Consequent upon exercise of conversion option, aggregating US$74.10 million, the Company allotted 28,549,566 Ordinary Shares/Shares represented by ADSs.
The Company issued rated, listed, unsecured, non-convertible debentures of Rs.1,100 crores.
The Company repaid Tranche 3 of Rs.1,800 crores of Secured, Rated, Credit Enhanced, Listed, 2% Coupon Non-Convertible Debentures (NCDs) alongwith premium on redemption of Rs.658.05 crores. Further, the Company also repaid Rs.362.19 crores forming part of the public fixed deposit scheme launched in December 2008.
The Company divested its investments in foreign subsidiary companies – Tata Daewoo Commercial Vehicle Co Ltd, Korea, Tata Motors (Thailand) Ltd, and Tata Motors (SA) (Proprietary) Ltd to TML Holdings Pte Ltd, Singapore, a wholly owned subsidiary.
Due to significant reduction in volumes, the Company had to deploy short term funds to support critical long term finance needs. The Company is in the process of taking appropriate steps to correct this and restructure the Balance Sheet.
At Jaguar Land Rover (as per IFRS), post spend on capex, design and development of GB£2,680 million (Rs.25,774.36 crores), the free cash flows were GB£1,150 million (Rs.11,059.90 crores) for FY 2013-14. The borrowings of the Jaguar Land Rover as on March 31, 2014, stood at GB£2,010 million (Rs.19,330.77 crores) [previous year: GB£2,167million (Rs.17,791 crores)]. Cash and financial deposits stood at GB£3,458 million (Rs.33,256.62 crores) [previous year: GB£2,847 million (Rs.23,373 crores)] resulting in negative net debt position. Additionally, JLR has undrawn committed long term bank lines of GB£1,290 million.
In December 2013, Jaguar Land Rover issued US$700 million Senior Notes due 2018, at a coupon of 4.125% per annum, followed by an issue of GB£400 million, at a coupon of 5.0% per annum in January 2014. The proceeds have been used for prepayment of high coupon Senior Notes issued in 2011 of equivalent GB£750 million which was callable in May 2014.
TML Holdings Pte Ltd, Singapore, a 100% subsidiary of the Company, holding the investment in Jaguar Land Rover raised SG$350 million Senior Notes due 2018, in May 2013, at a coupon of 4.25% per annum followed with an issue of syndicated loan facility of US$250 million and SG$62.8 million due 2017 and US$210 million and SG$114 million due 2019.
Tata Motors Finance Limited raised Rs.75 crores by an issue of unsecured, non-convertible, subordinated perpetual debentures towards Tier 1 and Tier 2 Capital and Rs.155.10 crores by an issue of unsecured, non-convertible, subordinated debentures towards Tier 2 Capital in order to meet its growth strategy and improve its Capital Adequacy ratio.
Tata Motors Group has undertaken and will continue to implement suitable steps for raising long term resources to match fund requirements and to optimise its loan maturity profile.
During the year, the Company's rating for foreign currency borrowings was retained with an improvement in the outlook by Standard & Poors to "BB"/Stable and was retained at existing levels by Moodys at "Ba3"/Stable. For borrowings in the local currency, the ratings was revised upwards by Crisil to "AA"/Stable and was retained at existing levels by ICRA at "AA-"/Positive. Post March 31, 2014, the ratings was revised upwards by ICRA to "AA"/Stable. The Non-Convertible Debentures rating by CARE was revised upwards to "AA+"/Stable. During the year, Jaguar Land Rover's rating was revised upwards by Moodys to "Ba2" Stable and by Standard & Poors at "BB"/Stable.
For Tata Motors Finance, CRISIL has revised its rating outlook on long-term debt instruments and bank facilities to 'CRISIL "AA/A+"/ Stable.
FIXED DEPOSITS
The Company has not accepted any public deposits during FY 2013-14. There were no over dues on account of principal or interest on public deposits other than the unclaimed deposits as at the year end. The Company proposes to invite and accept Fixed Deposits from the shareholders and the public in accordance with Sections 73 to 76 of the Companies Act 2013 read with Companies (Acceptance of Deposits) Rules, 2014. Attention of the Members is invited to the relevant item in the Notice of the Annual General Meeting and the Explanatory Statement thereto.
INFORMATION TECHNOLOGY INITIATIVES
The Company's business strategies are well supported by IT proactively building the capabilities. The Company's IT leverages strong partnerships with product and services companies to support business growth and innovation. This has enabled us to strengthen our core technology capabilities.
The major highlights of IT initiatives at the Company are:
- The Company commemorated 10 years of its path breaking CRM solution, one of the largest in automotive industry with 4,000+ channel partners and more than 50,000+ users.
- The Company played a key role in setting up AutoDX, a SIAM ACMA initiative for electronic data interchange (EDI).
- The Company is implementing cloud based employee collaboration tools which will bring a diverse and multi locational workforce closer, enabling the One Team One Vision initiative.
- The Company is extending its enterprise applications to mobiles through mobile apps. First five applications have been piloted for Telematics, Rural Marketing, Dealer Sales Force (CV and PV) and Quality Inspections.
- The Company won the 'CSI Award for the Excellence in IT' for executing the large and complex migration of entire Manufacturing Execution System (MES) platform in car plant.
- JLR global expansion to China is being competently supported by IT capabilities.
All Tata Motors group companies continue to work together on IT synergies and sharing the expertise.
DIGITAL PRODUCT DEVELOPMENT SYSTEMS INITIATIVES
Product development processes continue to grow on best of the breed tools and technology solutions, for enhancing product development capabilities, addressing quality and speed. Capabilities were developed for realistic product visualization in digital platform for product style. Bid response mechanisms for specific customers were developed. Processes relating to early manufacturing feedback in engineering functions were evolved with state of the art toolsets.
- PLM processes continue to mature strengthening the product development processes across the extended organization.
- In-house Knowledge Based Engineering (KNEXT) applications spread enhanced by deploying 20 new applications in various product design functions.
- Virtual validation as a strategic initiative introduced in the product development process providing better turnaround time and understanding of product in the field.
- Tools for collaboration of engineering information across multiple work locations, multiple geographies were developed as part of DRiVE initiative.
- Systems were developed to handle WCQ L1 and other quality initiatives.
- 30 new applications were conceived and developed on inhouse pFirst framework to handle various cross functional work stream delivery.
- Digital Manufacturing Planning (DMP) capabilities enhanced to use various process documents (PFD, PFMEA, CP, etc) in Pune manufacturing location.