Tata Sons has issued a statement on a report that claimed the Group had huge auto debts. "The statement calls the report misleading. "There has been a misleading report in the media today "Tata's biggest challenge: $14 billion in auto debt and a slowdown in China", it says.

Tata Group has further clarified that ‘the Tata Motors group is a Rs 3,00,000Cr international automotive conglomerate with a Networth of Rs 60,000 Cr that generates an EBITDA of Rs 27,000Cr. Its automotive business has a net debt of Rs 28,000Cr. Out of this JLR is Rs 6,500Cr (Net Debt / EBITDA of 0.4) and Tata Motors domestic business is 15,500Cr (Net Debt / EBITDA of 2.7).'

The statement also adds that the Group also has ‘Tata Motors Finance, an NBFC that finances commercial and passenger vehicles. This has a net debt of 38000cr to finance commercial and passenger vehicles with Net NPAs of 1.4% generating 12% ROE.'

"Our business is well capitalised with Consolidated Net Automotive Debt to Equity of 0.47. The maturities of our debt is well spread out right till 2027. Additionally, we have Rs 19,000Cr of undrawn revolving credit facilities. The business generates operating cash flows after interest of Rs 21500Cr," the statement says.

With regards to the numbers quoted by the article, the statement says that ‘the figures quoted in the article pertain to gross debt numbers which gives a misleading picture. As reported by all global auto industry firms, this needs to be seen as Net Automotive Debt (Gross debt less cash on hand without considering the financing arm) which, as can be seen from the above analysis, is at comfortable levels.'

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