New Chief Executive Faces Challenge of Addressing Three Major Cash-Draining Companies
NEW DELHI/ MUMBAI: Tata Sons’ new chairman faces significant challenges with three major cash-losing ventures: Air India, semiconductor and electronics manufacturing, and Tata Digital. The Indian government views Tata Group as a strategic partner in these sectors, particularly as it seeks to develop military aircraft and other defense technologies in the private sector.
The financial performance of these new businesses has raised concerns. Last year, Air India, Tata Digital, and Tata Electronics collectively reported losses nearing Rs 29,000 crore. Air India’s losses more than doubled to Rs 22,238 crore in the fiscal year 2025-26, with a turnaround expected to take several years. The semiconductor and electronics manufacturing sectors, while receiving government support, are also projected to take time to reach profitability.
Tata Digital has struggled to stabilize its operations, reporting losses of Rs 4,974 crore last year, an increase from Rs 4,610 crore in FY25, despite revenues rising to Rs 35,990 crore. The company has undergone three leadership changes since its inception in 2019. Its flagship venture, BigBasket, acquired in a deal valued at $1.5-2 billion in 2021, has lost market share in the competitive quick commerce space, holding only 4-5% compared to Blinkit’s 40%. The performance of Tata Digital’s Neu super app has also been underwhelming, lacking a clear value proposition for customers, according to industry analysts.
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