Tata Motors 2011- Tata Motors reduces net debt by 21% in FY11 to Rs 21,480 cr

Tata Motors 2011- Tata Motors reduces net debt by 21% in FY11 to Rs 21,480 cr

Tata Motors 2011

Tata Motors' consolidated net debt has come down by 20.70 per cent during 2010-11 to Rs 21,479.90 crore on account of fund generations from institutional buyers and conversion of foreign securities.

According to the company's Annual Report for 2010-11, Tata Motors had a net debt of Rs 27,086.49 crore as on March 31, 2010.

"The significant reduction in debt mainly relate improvement in operations, fund raising through Qualified Institutional Placement issue of Rs 3,249.80 crore and conversion of Foreign Currency Convertible Notes of Rs 1,490.25 crore," the company said.
The homegrown auto major said its British subsidiary Jaguar Land Rover (JLR) had a net debt of 233 million pound (about Rs 1,680 crore).

"During the year, JLR took steps to establish hedging lines in order to reduce risks to the business from foreign exchange fluctuations and establishing long-term funding facilities in order to strengthen the capital structure," Tata Motors said in the Annual Report.

On a standalone basis, the net debt of Tata Motors stood at Rs 13,838.90 crore as on March 31, 2011, compared to Rs 14,930.96 crore a year-ago.

During the last fiscal, Tata Motors' debt equity ratio improved to 1.71 from 4.28 as on March 31, 2010, it added.

The consolidated gross debt that comprises total of secured and unsecured loans has also come down to Rs 32,791.41 crore by the end of 2010-11 fiscal compared to Rs 35,108.36 crore in the previous fiscal.

The Annual Report also pointed out that the net interest cost of the company decreased by 8.67 per cent to Rs 2,045.42 crore from Rs 2,239.71 crore of 2009-10.

Due to improvement in operations, the net interest cost of JLR was Rs 153.32 crore in 2010-11 as against Rs 328.83 crore in 2009-10.

"The company has been successful in containing the costs through borrowings at lower rates and by substituting part of the borrowings through issue of equity," it added.

During the last financial year, the company's net cash generated from operations stood at Rs 11,240.15 crore as compared to Rs 8,997.13 crore in the previous year, the Annual Report said.

"The company has undertaken and will continue to implement suitable steps for raising long-term resources to match the company's fund requirement and to optimise its loan maturity profile," Tata Motors said.

In 2010-11, Tata Motors' consolidated net sales grew by 33.1 per cent to Rs 1,23,133.30 crore.