New Delhi, June 22 -- Agratas, the Tata group's electric-vehicle battery arm, has signed a seven-year supply agreement worth $530 million (about Rs.5,000 crore) with group company Jaguar Land Rover, beginning this fiscal year, according to company disclosures and an executive in the know. Agratas' first supply agreement is expected to initially cover the supply of NMC (nickel manganese cobalt) battery cells and generate about $42 million (Rs.400 crore) in revenue in FY27, according to a Tata Motors Passenger Vehicle Ltd (TMPV) resolution seeking shareholder approval for the related-party transaction and the executive. The proposed multi-year agreement delivers long-term shareholder value through supply security, cost competitiveness, technology leadership, and sustainability alignment, the resolution said. "These transactions enable smooth and uninterrupted business operations through a consistent supply of necessary requisite quality and quantity of batteries, leading to operational efficiencies, cost optimisation and enhanced productivity," it added. The executive said Agratas is targeting a commercial scale-up in the last quarter of the current fiscal year, with the agreement expected to eventually cover both NMC and LFP (lithium iron phosphate) battery chemistries. NMC and LFP cells are two types of lithium-ion cells used in EVs, with the former offering greater range and the latter greater stability. While luxury vehicles prefer NMC cells, mass-market EVs are moving towards LFP chemistry. The expansion of commercial operations is crucial, as the company has secured a $730 million loan facility from a consortium of banks backed by potential supply agreements with group auto firms. JLR and Agratas declined to comment on specifics of the agreement. India's automakers have been seeking to reduce reliance on China after Beijing imposed 2025 restrictions on exports of rare-earth magnets, a key EV component.Agratas is building a 20 GWh plant in Gujarat's Sanand and a 40 GWh plant in Somerset, UK, to cater to captive demand from Tata group automakers and external customers. The agreement also precedes the rollout of JLR's EV portfolio, including the Range Rover Electric and new Jaguar models, as the brand transitions to an all-electric future. The partnership is a strategically important win-win for both companies, said Vinay Piparsania, founder of MillenStrat Advisory & Research. "It reflects a growing trend among leading conglomerates where value creation increasingly comes not just from the strength of individual businesses, but from the synergies they can unlock across the group." Tapping captive supply may help JLR manage costs as it looks to save £1.7 billion over the next two years. The board of Agratas, formed in 2023, is chaired by Tata group chairperson Natarajan Chandrasekaran and includes JLR chief executive P.B. Balaji. Agratas' move, under chief executive Thomas Flack, to secure a long-term revenue stream comes at a crucial time for Natarajan Chandrasekaran, whose tenure is under review amid growing scrutiny of investments and returns from new businesses such as EV batteries, semiconductors, e-commerce, aviation and electronics....