2 days ago
Chinese-owned firm invests in Tata EV battery arm, appoints top lawyer to board
New Delhi/Bengaluru: A Chinese-owned electric vehicle (EV) battery maker with origins and base in Japan has picked up a stake in Tata Group's flagship EV battery company, and appointed its top lawyer to its board of directors.
Yokohama, Japan-headquartered AESC Group Ltd bought a 12% stake in Agratas Energy Storage Solutions Pvt. Ltd for ₹66 crore in March 2025. Tata Sons invested ₹484 crore for 88% stake, according to Agratas's filings with the ministry of corporate affairs thatMinthas seen.
Alongside, Gordon Louis Chin, general counsel of AESC Group, which is owned by Chinese energy technology company Envision, was made a director on Agratas's board. Tata Group chairman N. Chandrasekaran and P.B. Balaji—Tata Motors chief financial officer and soon-to-be chief executive officer of Jaguar Land Rover—are also on Agratas's board.
This is the first time the Tatas have acknowledged the role of a Chinese-owned company in its battery business. It's also the first time a new-age business of Tata group has attracted foreign investment and appointed a member to its board. Agratas has also secured more than ₹1,200 crore in investments from Tata Sons since its inception in 2023.
The deepening of ties between Agratas and AESC Group comes at a time when Indian automakers are facing the brunt of export restrictions imposed by China on rare earth magnets, which started in April.
Email queries sent to both companies remained unanswered till press time.
While Agratas has got AESC as an investor and on its board,Mintcould not independently ascertain if the two companies would collaborate on technology.
If it were to happen, though, it would benefit Agratas, believes Harshvardhan Sharma, group head for auto tech and innovation at Nomura Research Institute Consulting & Solutions India.
'For Indian companies like Agratas, this means immediate access to proven cell chemistries, manufacturing process IP, and yield optimization practices that typically take 5-7 years to build in-house," Sharma said.
He added that Japanese battery makers like AESC have long-standing supply agreements with global OEMs and raw material miners, critical in a market where cathode-grade lithium carbonate prices have swung by over 200% in the past three years.
What is AESC?
AESC, which was founded in Japan in 2007 and is still based there, is now owned by Zhang Lei-led Envision. AESC was founded as a joint venture between Nissan Motor Company and NEC Corporation, which sold controlling stake to the Chinese company in 2018.
Currently, Lei heads the board of directors as the executive chairman while other members from Nissan and AESC are also present on the nine-member board.
AESC has 10 gigafactories that produce lithium ion batteries – four in China, two in the US, and one each in the UK, France, Japan and Spain.
'AESC is among the global top 10 EV battery producers, with over 12GWh of installed capacity today and an aggressive expansion plan targeting 80+ GWh by 2030," Sharma of Nomura said.
Bloomberg reported in 2023 that the company was looking to raise $1 billion from investors with an eye on public listing in the American public markets. While its revenue was not publicly available, Bloomberg's estimate pegged it over a billion dollars.
According to AESC's website, it counts BMW, Mercedes-Benz,Renault, Nissan, Honda, Mazda and Mitsubishi Motors as some of its top customers.
Agratas's plans
Meanwhile, Agratas is building its own battery capacity of 60GWh through two gigafactories in the UK and India, which will cater primarily to the captive demand of Tata Group's automobile firms Jaguar Land Rover and Tata Motors.
In 2024, Agratas announced that it would build a 40GWh EV battery manufacturing plant in Somerset, UK. The firm is also building a 20GWh plant in Sanand, Gujarat, which is expected to begin production by December 2026.
'The project to set up giga factories in India and the UK is on track and will commence operations from FY27 in a phased manner," a Tata Motors spokesperson had told Mint earlier.
'At Agratas, we are establishing 60GWh battery capacity in India and the UK, backed by world class R&D centers in Bengaluru and Oxford," Chandrasekaran wrote in his letter to shareholders as part of Tata Sons annual report. 'By way of context, the global fleet of electric vehicles added in 2024 account for about 864GWh of battery capacity. Our first step in this direction should bring India to a meaningful scale."
New businesses under Chandrasekaran
Under Chandrasekaran, who took over as the chairman of Tata Sons in February 2017, Tata Sons has built four businesses.
These include airlines (Air India), assembling iPhones for Apple and building semiconductors (Tata Electronics), quick commerce and selling online (Tata Digital), and building high-quality batteries in the mobility and energy sectors (Agratas).
Tata Sons has relied on cash from dividends, share buybacks, and the sale of shares of Tata Consultancy Services (TCS) Ltd, the most profitable firm of the group, to build these new businesses.
Tata Sons' efforts to get an external investor in Tata Digital have remained a pipe dream while the company is still in the early stage of building its semiconductor business. Singapore Airlines had a 49% stake in Vistara, which, after being merged with Air India, gave Singapore Airlines a 25.1% ownership in Air India.
Agratas does not have any revenue while Tata Electronics, Tata Digital and Air India, together, ended with ₹1,77,425 crore or $20 billion or revenue last fiscal year. However, the three businesses together also ended with losses to the tune of ₹15,539 crore ($1.8 billion).
