InvestorQ : Can you tell me something about how Tata Motors is planning to hive off non-core businesses?
Mary Joseph made post

Can you tell me something about how Tata Motors is planning to hive off non-core businesses?

Answer
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Arusha Ray answered.
2 weeks ago


Tata Motors will be putting two of its business group companies; Tata Technologies and Tata Hitachi Construction Machinery on the block for stake sale. This is part of the deleveraging plan where non-core businesses are being transferred or monetized.

“Tata Motors is in talks with multiple stakeholders for a stake sale in these two group companies so that the value so monetized can be used to reduce the debt over the next 3 years. Tata Technologies has been a unit of Tata Motors since 1989.

The total debt of Tata Motors has risen from Rs.48,000 crore in March to Rs.68,000 crore in July due to the extensive cash burn due to covid-19 led disruptions. This has underlined the urgent need for Tata Motors to deleverage its balance sheet.

Tata Motors has already been implementing highly aggressive measures to control costs and save cash with a view to generating free cash flows. The company plans to save Rs.6000 crore in costs in next 3 years to give a boost to its deleveraging thrust.