Tata's debt to cross 1 trillion; liquidity safe

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New Delhi, Mar 16: Analysts are stating that Tata group's total debt will exceed Rs 1,00,000 crore in the current fiscal, but the company has a good liquidity position. "We expect the total debt of the Tata group as of the end of FY'09 (ending this month) at over Rs 1 trillion, of which Rs 117 billion is due through March 2010," analysts at domestic brokerage unit of financial major Kotak group said.

When asked about the same, Tata Sons spokesperson said that Tata Sons does not aggregate the debt of individual group companies as each company is a standalone legal entity and is evaluated accordingly.

The increasing debt is due to its aggressive capital expenditure plans and past acquisitions, the report stated. However, analysts said that debts are manageable and obligations could be met through free cash flow generated at various group companies and proceeds from the stake sale by holding company Tata Sons.

Total debt of these five entities -- Tata Motors, Tata Steel, TCS, Tata Power and Tata Communications – which account for 90 per cent of the group's revenues, is estimated at Rs 91,000 crore in FY2010, the analysts said.


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