MUMBAI: Tata Sons chairman N Chandrasekaran has initiated plans to shrink over 1,000-odd subsidiaries owned by the Tata Group ’s operating companies to a manageable number.Further, the group’s immediate priorities are to stabilise the loss-making Jaguar Land Rover unit, figure out a way forward for relatively weaker businesses such as aviation and infrastructure while scaling up highgrowth sectors such as consumer and retail, according to a senior official familiar with the group’s plans.The group has also applied to the ministry of corporate affairs to register a new company to launch its ecommerce business. “It is not the standard Flipkart or Amazon model,” the executive said. The plan is to start the operations this year, he said.“The group has more than 1,000 subsidiaries. We don’t need so many,” the official explained on condition of anonymity. “… a restructuring of this kind is going on in every large Tata operating company. The number of subsidiaries that we are tackling runs to a dozen in some companies,” he added.The merging of subsidiaries is still a work in progress. All this will take about 12-18 months as multiple board meetings and consents have to be obtained. “Some of these subsidiaries don’t fit in our scheme of things because they cannot scale up,” he added. One listed Tata Group company, the executive said, had almost 33-odd subsidiaries and 33 boards.In the next phase, the broad direction of strategy is to reduce the number of operating companies owned by Tata Sons.For this, strategic partners may be brought on board the infrastructure and financial services businesses. The group will be “extra careful” as the businesses require constant cash infusion till they achieve scale, and then strategic investors are enlisted, he explained.On the retail front, the group has seen faster rollout of outlets for Titan, Trent’s Westside and Croma, compared with previous years, the official said. The group is fine-tuning the Star Bazaar model, he said, before the retail chain decides to scale up this format. The group is bullish on the retail business and will take a call on formats they are not currently present in, such as speciality retail.Former Tata Sons director R Gopalakrishnan said: “Chandra has a complex set of challenges to deal with and his actions show evidence of tackling it effectively.”“The focus on JLR for the moment is to nurse it back to profitability,” the executive cited said, dismissing all talk of further impairments. Tata Motors was forced to write down 3.1 billion pounds as impairment charges on account of a China slump and Brexit.Terming JLR a success story, the official said the company had paid one billion dollars to Tata Motors as dividend income. He also defended both the Corus and JLR deals.Under Tata Motors CEO Guenter Butschek, the domestic business has made a turnaround and the car business is on its way to becoming ebitda positive in the coming quarters.TCS has been funding Tata Sons, through its generous dividends and buyback programmes, which in turn is redeployed into group companies through rights issues. But challenges on many fronts, such as telecom and its European steel business, has slowed down the group from taking new investment calls.“Ability to fight on multiple fronts will be a challenge. Capital will be a key deciding factor. Whether they can, is key to its many businesses that need funds to scale up. These businesses should ideally run on their own pace without being too adventurous,” Mahesh Singhi, founder, Singhi Advisors, said.The group will face several challenges in the coming years. Scaling up its aviation business is a big challenge and the group is still working on a plan. “There are two loss-making companies with committed partners. We will have to see the way forward,” the executive said.“There has been a proper realignment of thinking by the chairman and he has a better strategic understanding of issues now. Instead of the initial narrative of just focussing on growth and deal-making, the strategies are more well-considered,” a group director said, on condition of anonymity.Chandrasekaran has been at the helm for two years. His interventions in the Tata Steel and Indian Hotels front have paid off and is reflected in the results shown in its December quarter. He is pushing them to focus on the Indian market as the group now believes the opportunity in India is far greater than what is available abroad. “In India, there is a lot of demand. Once the European merger goes through for Tata Steel, we’ll be completely focussed on India,” the official said.The move to merge the two European outfits will bring debt to 3 times ebitda or even 2.5 times ebitda. Tata Steel will have cash. “His (Chandra’s) strategy is simple… Put money where it is required and sell assets where it is non-core. The companies get operating leverage when one does all those things,” he added.“You can see decisiveness after many years at Tata Steel,” said Singhi.However, Chandra is apparently now cautious when it comes to the group’s financial services subsidiary Tata Capital. The company has been asked to “go slow for now” on its plans due to uncertainties prevailing in the NBFC sector.Chandra’s stint so far has seen the tackling of cross-holdings within the Tata Group’s listed companies. Thus Tata Power shed Tata Communications stake and Tata Chemicals has shed its stake in Tata Global Beverages.The group under Chandra so far has taken major strategic steps to exit the mobile telephony business in favour of Sunil Mittal’s Bharti Airtel. Tata Sons also exited Tata Petrodyne during this twoyear period.Tata Steel’s European business Corus has been merged with Thyssenkrupp, helping its parent to focus on its Indian business, which is more profitable and poised for growth, through aggressive acquisitions made through the insolvency process and brownfield expansion being planned at Odisha.Tata Steel also exited NatSteel even though there were “emotions involved”, the official revealed, as it was the first foreign acquisition by the steel company.“Two years is maybe a bit too early to ask for growth. So Chandra should be given more time and he shouldn’t be reckless, but he will have to show more concrete results from the third year onwards,” said a former Tata Sons director.