Few companies in India have been more rattled by the global financial crisis than Tata, a conglomerate whose interests range from tea to IT.

In recent years the group acquired far and wide. Its biggest deals picked-off three British icons: Corus (formerly British Steel), Land Rover and Jaguar.

But Ratan Tata, the chief executive, has slammed on the brakes. In a recent e-mail to his 98 companies he commanded each to tighten its belt and ditch acquisition plans. “Failure to manage this crisis could result in irretrievable positions,” he said.

The sense of panic is palpable. For years, the jewel in Tata’s crown has been Tata Consultancy Services, the IT outsourcer. This summer, TCS’s net earnings growth collapsed to 2 per cent, from 55 per cent a year earlier, after a massive dollar hedging position went terribly wrong. And in the past few weeks, clouds gathered over the future of one of TCS’s biggest clients: Citigroup.

Horror stories abound: Tata Motors, India’s biggest lorry maker, has seen monthly sales plummet by nearly half in a year. Its flagship project to manufacture the world’s cheapest car, the 100,000 rupee Nano, has been pushed back by months after violent protests at the original factory – now abandoned – by farmers who said the land had been stolen from them. Tata Steel has been hit by a slump in the price of, yes, steel.

The conglomerate is now a seller: it recently let go a 26 per cent stake in Tata Teleservices, arguably its most attractive asset, to Japan’s NTT DoCoMo for $2.7 billion. Amid the turmoil, investors have already dodged one Tata cash call and senior bankers in Mumbai say the company would struggle to borrow any significant sum. In August, Tata Motors was forced to scrap a 30 billion rupee (£430 million) rights issue after the share price fell below the offer price. Two other Tata Motors rights issues for a further 42 billion rupees had to be bailed out by the group holding company, Tata & Sons, and the underwriter, JM Financial, an Indian bank.

One factor behind investors’ indifference was a rights issue prospectus that detailed how Jaguar and Land Rover recorded a loss of $383 million after tax in the first six months of the year. The document gave a rare insight into the marques’ finances: brokers in Mumbai have said that they cannot assign a value to the two brands, so scant is the information Tata has made available.

The market’s uncertainty helps to explain Tata Motors’ approach to the UK Government for £1 billion to support Jaguar and Land Rover. In India it is used to politicians lending a hand. The state of Gujarat reportedly offered Tata incentives worth nearly £500 million to relocate the plant for the Nano within its borders.

Perhaps Tata felt that asking a mere twice as much from the UK taxpayer to support two marques of the pedigree of Land Rover and Jaguar represented a bargain?

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