Tata Motors, the country’s largest automotive manufacturer, has earmarked ₹38,800 crore as capital expenditure for the current financial year. This is an 11.20 per cent increase over the ₹34,889 crore the company had set aside in FY15
The company said it will invest on new products and technology, including for its British subsidiary Jaguar Land Rover (JLR).
JLR is enhancing its technological strengths through in-house R&D at its two engineering and design centres in the UK. Additionally, the company has purchased 62 acres of land to double the size of its Advanced Design and Engineering Centre in Whitney, UK. Further, its National Automation Innovation Centre (NAIC), which will be a technology hub for the JLR research team, will open in spring 2017. Earlier in March, Tata Motors had announced an investment of £150 million to set up NAIC.
The increase in overall capital investment comes as part of chairman Cyrus Mistry’s efforts to turn around the automobile company. “India is forecast to witness multi-fold increase in motorisation. The company is strongly investing in product and technologies that would make it future ready and would also fuel international growth,” Mistry said in his annual address.
Under its customer-focused ‘Horizonext’ strategy for passenger vehicles unveiled in 2013, the company has lined up a product pipeline till 2020. The company intends launching two new products every year.
To raise capital
Tata Motors will seek shareholders’ approval at its AGM on August 13 to raise up to ₹4,400 crore by way of non-convertible debentures (NCDs) on a private-placement basis. The amount will be raised over one year from the date of passing the resolution, according to the company’s annual report.
The company posted a consolidated revenue of ₹263,695 crore ($42.19 billion) in 2014-15. On Friday, Tata Motors’ share closed 0.92 per cent higher, at ₹398.75, on the BSE.
[“source – thehindubusinessline.com”]