Tata Motors plans ₹2,000 crore fund raise through NCD issue on March 19

Tata Motors Ltd., a leading manufacturer of domestic and commercial vehicles, informed the exchanges on Thursday that its board will meet on Wednesday, March 19, to consider a fund raising proposal up to ₹2,000 crore.

The fund raising will be done through the issuance of rated, listed, unsecured, redeemable, Non-Convertible Debentures on a private placement basis.

Tata Motors' board had approved the fund raising plans in March and may last year.

The funds raised are expected to be utilized for general corporate purposes, including but not limited to, research and development, capacity expansion, and working capital requirements.

The meeting on March 19th is expected to provide further details on the terms and conditions of the NCD issuance, including the coupon rate and maturity period.

Tata Motors' CFO assured analysts in a meet recently that Jaguar Land Rover (JLR) will meet its fourth quarter EBIT margin guidance of 10% will also turn net debt free by the end of the financial year.

The CFO also said that the US market continues to do well, while Tata Motors is outperforming in China through JLR.

Brokerage firm Nomura estimates volume growth for financial year 2025, 2026 and 2027 to be flat, grow at 4% and at 6% year-on-year respectively.

Nomura has a "buy" rating on Tata Motors with a price target of ₹861. The stock is trading at 4.7 times financial year 2027 Enterprise Value to EBITDA.

Shares of Tata Motors are rebounding slightly from their 52-week low. However, they ended Thursday's trading session 2% lower at ₹654.7. The stock is down over 40% from its July 2024 peak of ₹1,179.