Tata Motors to raise Rs 500 crore via private placement of securities

India’s largest auto maker Tata Motors inched up on bourses as the company announced that the company’s plan to raise Rs 500 crore through issuance of securities on private placement basis was approved by the authorized committee on June 21, 2017.

Assigned AA+ rating by CARE, the securities to be issued will be listed on both the BSE and the NSE, maturing on June 22, 2022. Even as the company’s luxury car manufacturing subsidiary, JLR posted a record breaking sale, the company struggled with the global wholesales declining by one per cent in May 2017, compared to the May 2016 wholesale data.   
  
The company also posted a 16.8 per cent decline in its consolidated net profit in the fourth quarter of the fiscal year 2017, however, the net profit of Rs 4,336 crore were still better than the market expectations.
  
The auto maker also went through an organisational restructuring exercise in the previous month, dismissing over 1,500 posts at the managerial level, in a surprising move. 
  
Despite the downsides, the current fiscal is expected to turnaround as a silver lining for the company, with a string of new launches in the pipeline. Whereas, recent launches by the company including Tiago, Tigor and Hexa are securing a good response in the domestic market. The launch of Discovery, Range Rover Velar, and latest versions of Range Rover and Range Rover Sport are likely to push the CAGR growth for JLR at the international front.

In intraday trade, Tata Motors was trading at Rs 460.40, up by 0.68 per cent on the BSE in line with the BSE auto index at 24158.47, up by 0.57 per cent. The BSE sensex was trading at 31,478.76 level, up by 0.60 per cent at the same time.