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Tata Motors to cut debt by Rs 4,000 crore

Tata Motors to cut debt by Rs 4,000 crore

The automaker will use the proceeds of its Rs 7,490 crore rights issue for reducing the debt, said Vijay Somaiya, vice-president and head, Treasury and Invester Relations, Tata Motors.

Tata Motors, India's largest automobile company, looks to reduce its standalone debt by Rs 4,000 crore in the next three months. The company has about Rs 21,130 crore debt at the end of the last financial year.

The  automaker will use the proceeds of its Rs 7,490 crore rights issue for reducing the debt, said Vijay Somaiya, vice-president and head, treasury and investor relations, Tata Motors. "The rights issue proceeds are in fixed deposits. We will redeem the deposits when debt maturity comes up," he added,

The gross debt of the Tata Motors group stood at Rs 73,600 crore at the end of the last financila year. Jaguar and Land Rover has its debt at  2.5 billion British Pound, while net debt/equity stood at (0.29), reflecting a net cash of 1.7 billion British Pound on books.

The company has spent Rs 37,912 crore for the capex and product development during FY 15, including the spend of 3.1 billion British Pound at JLR. Cash and bank balance (including mutual funds) stood at Rs 46,174 crore.

For the fiscal, the homegrown auto major's consolidated net profit was at Rs 13,986.29 crore, marginally down from Rs 13,991.02 crore in the previous year. Consolidated net sales for 2014-15 stood at Rs 2,60,734.33 crore as against Rs 2,30,677.10 crore in the previous fiscal.

It has reported a 56.19 per cent decline in consolidated net profit at Rs 1,716.50 crore for the fourth quarter, as its domestic business continued falling, while British brand Jaguar witnessed weak demand. The company had reported a consolidated net profit of Rs 3,918.29 crore in the quarter.

On a standalone basis, the company's net loss for the fourth quarter widened to Rs 1,164.25 crore from Rs 816.61 crore in the year-ago period. Standalone net sales were at Rs 10,676.19 crore as against Rs 8,438.86 crore in the previous fiscal. JLR's profit after tax during the fourth quarter stood at 302 million pounds as against 449 million pounds in the corresponding period last year.

Tata Motors share price ended at Rs 497.10 on the BSE, down 1.60 per cent from the previous close.

Published on: May 26, 2015, 9:10 PM IST
Posted by: Aseem Thapliyal, May 26, 2015, 9:10 PM IST