Proposal

Legal Requirement

Rationale and utilization of proceeds

Eligibility of American Depository Receipts (ADR) holders to the Rights Issue

Next Steps

Note: For detailed information on the proposal for the said Rights Issue, kindly refer the Notice alongwith the Explanatory Statement appended hereto.

Dear Member,

Notice is hereby given pursuant to Section 110 and other applicable provisions of the Companies Act, 2013, (“Companies Act”) if any, read together with the Companies (Management and Administration) Rules, 2014, including any statutory modification or re-enactment thereof for the time being in force for seeking consent of the Members of the Company to pass the following Resolution through Postal Ballot.

Issue of ordinary shares and ‘A’ ordinary shares through a Rights Issue

To consider and, if thought fit, to pass with or without modification, if any, the following resolution as an Ordinary Resolution:

“RESOLVED THAT pursuant to the provisions of Section 62(1), Section 43(a)(ii) and other applicable provisions, if any, of the Companies Act, 2013, (the “Companies Act”) and the rules framed thereunder, as amended, the Foreign Exchange Management Act, 1999, as amended, the Foreign Exchange Management ( Transfer or Issue of Security by a Person Resident Outside India) Regulations, 2000, as amended and the rules, regulations, guidelines, notifications and circulars, if any, issued by the Government of India, the Foreign Investment Promotion Board, the Reserve Bank of India, the Securities and Exchange Board of India including the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended and the Securities and Exchange Board of India (Substantial Acquisitions of Shares and Takeovers) Regulations, 2011, as amended and any other guidelines and clarifications issued by any other competent authority, whether in India or abroad, to the extent applicable including the enabling provisions of the Memorandum of Association and Articles of Association of the Company, Listing Agreements entered into by the Company with the Indian Stock Exchanges where the ordinary shares and‘A’ordinary shares of the Company are listed (the “Stock Exchanges”) and subject to the permissions, consents, sanctions and approvals by any authorities, as may be necessary, and subject to such conditions and modifications as may be prescribed while granting such approvals, consents, permissions and sanctions, and which may be agreed to by the Board of Directors of the Company (hereinafter referred to as the “Board”, which term shall be deemed to include any Committee(s) constituted/to be constituted by the Board to exercise its powers including the powers conferred by this Resolution), and subject to any other alterations, modifications, conditions, changes and variations that may be decided by the Board in its absolute discretion, the consent of the Company be and is hereby accorded to the

Board to create, offer, issue and allot in one or more tranches, by way of a Rights Issue, the ordinary shares (OS) and ‘A’ ordinary shares (AOS), both of the face value of 2/- each(and unless expressly specified otherwise the term “Shares” shall hereinafter collectively refer to both OS and AOS of the Company) to the holders of Shares, including the Depositary on behalf of holders of American/Global Depositary Receipts existing as on a record date to be determined by the Board, or their renouncees, including resident/foreign shareholders, Institutions, Non-resident Indians, Corporate Bodies, Mutual Funds, Banks, Insurance Companies, Pension Funds, Foreign Portfolio Investors and Individuals (collectively, the“Investors”) at such time or times, at such price or prices, including at a discount to the market price or prices in such manner and on such terms and conditions considering the prevalent market conditions at that time and such other consideration that the Board may, in its absolute discretion, decide, such that the aggregate value (including premium on face value of the Shares) does not exceed 7,500 crores (Rupees Seven Thousand Five Hundred crores only).”

“RESOLVED FURTHER THAT in accordance with the Articles of Association of the Company, pursuant to any issuance of OS and AOS by way of a Rights Issue, the holders of OS shall receive further OS and the holders of AOS shall receive further AOS in the same proportion of OS and AOS held in the capital of the Company on a record date that may be fixed by the Company for determining the entitlement of the said holders in the Rights Issue.”

“RESOLVED FURTHER THAT:

“RESOLVED FURTHER THAT for the purpose of giving effect to the above Resolution including any offer, issue or allotment of OS and AOS, the Board be and is hereby authorized on behalf of the Company to do all such acts, deeds, matters and things, as it may, in its absolute discretion, deem necessary or desirable for such purpose, including without limitation, the determination of terms and conditions for issuance of the Shares and proportion thereof, timing for issuance of such Shares, issue price, premium on face value, if any, (provided that the pricing of the AOS would be on the same principles as the pricing of the OS) and shall be entitled to vary, modify or alter any of the terms and conditions as it may deem expedient, entering into and executing arrangements for managing, underwriting and/or standby, marketing, listing, trading and providing legal advice as well as acting as depository, custodian, registrar, stabilizing agent, escrow agent and executing other agreements, including any amendments or supplements thereto, as necessary or appropriate and to finalise, approve and issue any document(s), including but not limited to letter of offer and/or offering circular and/or offer document and/or documents and agreements including filing of registration statements, and other documents (in draft or final form) with any Indian or foreign regulatory authority or stock exchanges and sign all deeds, documents and writings and to pay any fees, commissions, remuneration, expenses relating thereto and with power on behalf of the Company to settle all questions, difficulties or doubts that may arise in regard to the issue, offer or allotment of Shares including allotment of Shares that are not subscribed and take all steps which are incidental and ancillary in this connection, including in relation to utilization of the issue proceeds, as it may in its absolute discretion deem fit without being required to seek further consent or approval of the Members of the Company.”

“RESOLVED FURTHER THAT the Board be and is hereby authorised to delegate all or any of its powers herein conferred to any Committee thereof or to any one or more executives of the Company.”

By Order of the Board of Directors

H K Sethna

Company Secretary

Mumbai, January 27, 2015

Registered Office:

Bombay House, 24, Homi Mody Street, Mumbai 400 001

Tel: +91 22 6665 8282. Fax: +91 22 6665 7799

Email: inv_rel@tatamotors.com

Website: www.tatamotors.com

CIN - L28920MH1945PLC004520

NOTES:

EXPLANATORY STATEMENT

Explanatory Statement pursuant to Section 102 of the Companies Act, 2013 (“Companies Act”) to the accompanying Notice dated January 27, 2015:

Issue of ordinary shares and ‘A’ ordinary shares through a Rights Issue

Company’s strategic plans and fund requirements:

The Company has embarked on a dynamic journey to achieve profitable growth and expansion of its product offerings and geographical presence, both globally as well as in India. These developments are expected to include the addition of more than 100 products (taking into account differing tonnages, power train combinations and variants) in the commercial vehicle business over the next 3 years, the introduction of 2 or 3 new products each year in the passenger vehicle business, the adoption of a new modular platform from 2016-17 onwards, the addition of more than 40 new products (taking into account differing variants and power train combinations) over the next 5 years in the Company’s Jaguar Land Rover business, an increase in manufacturing capacity in the UK, an expansion of Jaguar Land Rover’s operations in China, Brazil and potentially other markets, de-risking the Jaguar Land Rover business by setting up its own engine plant in the UK, investment in technology, including to enable compliance with increasingly stringent emission requirements, expansion of commercial and passenger vehicle operations in Thailand, Indonesia and South Korea (through the Company’s existing manufacturing bases), as well as penetration of new export markets for India business including Australia, Philippines and Vietnam.

Brief description of each of the key business areas of the Company are set forth below.

India Business:-

The Company offers a diverse range of products in its portfolio of commercial vehicles, starting from 0.5 ton vehicle to upto 49 ton vehicles. The Company also offers a wide variety of passenger vehicles, ranging from small hatchbacks to UVs.

The Company has drawn a strategic road map, under the umbrella “Horizonext” which is aimed at strengthening its position and market share in commercial vehicles and regaining market share in passenger vehicles.

During the past 3 years, the Company has encountered challenging conditions in its India business due to a significant slowdown in the Indian economy and reduced demand for the entire automobile industry in general and the commercial vehicle industry in particular. Volumes in the medium and heavy commercial vehicles’ sector fell by around 49% from FY12-FY14. The Company, being a lead player in the Commercial Vehicle industry (with an overall market share of 54%) was significantly impacted by the slowdown.

Nevertheless, the Company has utilised this period of slowdown as an opportunity to further strengthen its product profile and offerings of other value added services for the customers in the commercial vehicle business, reshaping its passenger vehicle product portfolio and improve customer and dealer engagements in the passenger vehicle business, undertake several organisational changes, including the the creation of a new Programme Planning & Project Management (PPPM) which is intended to front-end and improve the execution of new product development projects for creating competitive and profitable products, the centralisation of procurement and supply chain functions and the creation of a new role for Vehicle Line Directors who are tasked with overseeing product programs for various vehicle lines and bring accountability on parameters such as timelines, cost, quality, profitability that are critical for the success of the products in the marketplace. With all these changes and current undergoing initiatives, the Company believes that it will emerge stronger from the slowdown and is ready for taking a leap into the next phase of growth.

Several key strategic initiatives commenced by the Company are as set forth below:-

With a clear strategic road map and direction, the major actions planned for the next growth phase are:-

Commercial Vehicles:

Passenger Vehicles:

Jaguar Land Rover Business (JLR):

JLRs strategy continues to be, to profitably grow its strong and globally recognized brands. JLR continues to invest substantially, towards development of new products in new and existing segments, new power trains and technologies to meet customer and regulatory requirements and to increase its manufacturing capacity in the United Kingdom, China, Brazil and potentially other international markets.

The significant growth in JLR sales and profitability with a strong cash and liquidity position has supported JLR capital spending strategy.

JLR continues to have a longer term capital spending target of 10-12% of revenue, which it believes is in line with other premium competitors, but in the near and medium term, JLR expects its capital spending to be a greater percentage of revenue in order to realise the present opportunities for growth. JLR continues to target funding most of its capital spending out of operating cash flow. JLR expects its strong Balance sheet and proven access to funding from capital markets and banks to support its requisite investment plans.

Other Subsidiaries:

The Company intends to increase its market position and presence in the geographies where it has a manufacturing base through its subsidiaries like Tata Motors Thailand (TMTL), PT Tata Motors Indonesia (PTTMI), Tata Motors South Africa (TMSA) and Tata Daewoo Korea (TDCV). The Company expects to launch several new products - Medium and Heavy Commercial Vehicles, Light Commercial Vehicles and some launches of passenger vehicles in these markets aimed at increasing the Company’s market presence and achieving profitable volume growth.

Further, the Company also expects to invest in its captive finance subsidiary to enable it to capitalize on the next phase of economic growth in India.

Company Funding Strategy:

Considering the future growth and expansion plans of the Company on a global basis, it is expected that the total capital outlay will remain high in the near term (~an average of 4,000 crores p.a., approx. US$ 651 million based on exchange rate of US$1: 61.12 as on date) for the India business, GBP3.5-3.7 billion per annum (approx. US$5.3 to 5.6 billion based on exchange rate of US$ 1.50:GBP 1 as on date) for JLR and similar elevated levels for each business in the next 2-3 years).

While the Company endeavours to meet a significant portion of its total spend on global basis through its consolidated cash flow from operations, taking into account the cyclical nature of the automobile operations, ( as evidenced by the downturn in India and the negative impact on operating cash flows) and future capex and product development programme for the Tata Motors Group, it is considered prudent at this stage for the Company to raise funds.

It is currently envisaged to raise funds through the issue of ordinary and ‘A’ ordinary shares of the Company, both of the face value of 2/- each (together referred to as the “Shares”) on a rights basis for an amount not exceeding 7,500 crores (approx. US$ 1.2 billion based on an exchange rate of US$1: 61.12 as on date)in one or more tranches at such price as may be considered appropriate by the Board, to the members as set out in the said Resolution.

As mentioned above, the Rights Issue proceeds are expected to be utilized to finance a portion of the ongoing capital expenditure, including product development expenses; invest in subsidiaries to support future growth opportunities in India and abroad; strengthen capital structure by deleveraging the balance sheet to build financial flexibility; partly correct the accumulated mismatch between the long term sources and application of funds; meet issue expenses; and general corporate purposes.

Proposal:

The Company proposes to raise additional capital aggregating upto 7,500 crores by way of issue of ordinary shares and ‘A’ ordinary shares having differential voting rights of the Company, on a rights basis, in one or more tranches, to the ordinary shareholders and ‘A’ ordinary shareholders, respectively (the “Rights Issue”) i.e. ordinary shareholders existing as on the record date shall only receive new ordinary shares whereas the ‘A’ ordinary shareholders existing as on the record date shall only receive new ‘A’ ordinary shares, in accordance with the Company’s Articles of Association, the applicable provisions of the Companies Act read with the rules made thereunder, to the extent notified and in effect and Chapter IV of the Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009, as amended (the “ICDR Regulations”) and as approved by the Board by way of a resolution passed at its meeting held on January 27, 2015.

Although the Company currently intends to file a registration statement with the U.S. Securities and Exchange Commission to enable holders of ADRs to participate in the Rights Issue, there is no assurance that such registration statement will be filed. Accordingly, there is no assurance that ADR holders will be able to participate in the Rights Issue on the same basis as holders of ordinary shares or at all. This notice does not constitute or form part of an offer to sell or issue or an invitation to purchase or subscribe for any securities of the Company in any jurisdiction where such offer or sale is not permitted, and no part of this notice shall form the basis of or be relied upon in connection with any contract or commitment.

Statutory provision and disclosure:

Section 62 of the Companies Act, inter-alia provides that whenever it is proposed to increase the subscribed capital of a company by allotment of further shares, such further shares shall be offered to the persons who on the date of the offer are holders of the equity shares of the company in proportion to the capital paid-up on that date unless shareholders in a general meeting/postal ballot decide otherwise. The Listing Agreement executed by the Company with various Stock Exchanges also provides that a company shall in the first instance, offer all securities for subscription pro rata to the shareholders, unless the shareholders decide otherwise.

In the event that the Company issues additional ordinary shares and ‘A’ ordinary shares on a rights basis, the said additional shares are not expected to be more than 10% of the aggregate paid-up ordinary and ‘A’ ordinary Share Capital of the Company. The ordinary shares and ‘A’ ordinary shares, if any, allotted on issue, shall rank pari passu inter se and with the existing ordinary shares and ‘A’ ordinary shares, of the Company respectively, as the case may be.

Whilst generally for a Rights Issue, members’ approval is not required under the Companies Act, taking into consideration that the Rights Issue also contemplates the issue of ‘A’ ordinary shares to the ‘A’ ordinary shareholders and as required under Section 110 of the Companies Act read alongwith Rule 4(1)(b) of the Companies (Share Capital and Debentures) Rules, 2014, approval of the members is being sought.

The Company meets the criteria for issue of ‘A’ ordinary shares under Rule 4 of the Companies (Share Capital and Debentures) Rules, 2014 and would comply with the requirements of the same as set forth below:

The other information prescribed under Rule 4(2) of the Companies (Share Capital and Debentures) Rules, 2014 with regard to disclosure in the Explanatory Statement in respect of a proposal for issue of Shares with differential voting rights is as follows:-

The Company proposes to issue Shares on a rights basis upto an amount not exceeding 7,500 crores. Currently, the ‘A’ ordinary shares comprise 14.97% of the Company’s paid- up capital. Considering that a Rights Issue is envisaged, it is expected that the number of ‘A’ ordinary shares would comprise of 14.97% of the total number of Shares proposed to be issued pursuant to the Rights Issue.

The rights, powers and preferences relating to ‘A’ ordinary shares and the qualifications, limitations and restrictions thereof are as set out in Article 67A of the Articles of Association of the Company.

Further, the holders of ‘A’ ordinary shares shall be entitled to differential voting rights as follows:

The holders of ‘A’ ordinary shares shall be entitled to dividend for any financial year at 5 percentage points more than the aggregate rate of dividend declared on ordinary shares for that financial year (i.e. the aggregate dividend paid on each ‘A’ ordinary share in any financial year would be 0.10 more than the aggregate dividend paid on each ordinary share). In case no dividend is recommended for ordinary shares for a financial year, the ‘A’ ordinary shareholders would also not receive any dividend.

The Company proposes to issue Shares on a rights basis upto an amount not exceeding 7,500 crores. Currently, the ‘A’ ordinary shares comprise 14.97% of the Company’s paid-up capital. Considering that a Rights Issue is envisaged, it is expected that the number of ‘A’ ordinary shares would comprise of 14.97% of the total number of Shares proposed to be issued.

As per Article 7A of the Company’s Articles of Association, at any point of time, the total number of ‘A’ ordinary shares issued and outstanding shall not be in excess of 25% of the total share capital (ordinary shares and ‘A’ ordinary shares taken together) issued and outstanding of the Company.

The Rights Issue proceeds are expected to be utilized to finance a portion of the ongoing capital expenditure, including product development expenses; invest in subsidiaries to support future growth opportunities in India and abroad; strengthen capital structure by deleveraging the balance sheet to build financial flexibility; partly correct the accumulated mismatch between the long term sources and application of funds; meet issue expenses; and general corporate purposes.

In terms of Article 67A(c)(i) of the Articles of Association of the Company, where the Company proposes to make a Rights Issue of ordinary shares or any other securities convertible into ordinary shares, the Company shall simultaneously make an offer to the holders of ‘A’ ordinary shares in the same proportion of ‘A’ ordinary shares to ordinary shares prior to the issue. Accordingly, the Company proposes to issue ‘A’ ordinary shares in the Rights Issue. The holders of ‘A’ ordinary shares shall receive further ‘A’ ordinary shares whereas holders of ordinary shares shall receive further ordinary shares.

The Board of Directors shall determine the price of the ‘A’ ordinary shares (including, the premium on such ‘A’ ordinary shares) issued pursuant to the Rights Issue at a later date.

The Board of Directors shall determine the basis of the ‘A’ ordinary shares (including the premium, if any, on such ‘A’ ordinary shares) to be issued pursuant to the Rights Issue at a later date. Full justification of the offer price shall be disclosed in the final Letter of Offer.

The voting rights on the existing ‘A’ ordinary shares represent 1.49% of the total voting rights of the aggregate share capital (ordinary shares and ‘A’ ordinary shares taken together).

The existing voting rights of the ordinary shares and ‘A’ ordinary shares are fixed and are not subject to variation.

There will be no change in the control of the Company subsequent to the Rights Issue.

The Board of Directors shall determine the number of ‘A’ ordinary shares to be issued in the Rights Issue at a later date. Accordingly, the diluted earnings per share pursuant to the Rights Issue cannot be determined at this stage.