The Tata group's main holding and promoter company reported a gross debt of ₹363.2 crore at the end of March this year, down sharply from ₹22,176 crore at the end of FY23. Against this, the company reported cash and equivalents worth ₹3,042 crore at the end of FY24, up from ₹1,534 crore a year ago. This translated into a negative net debt of ₹2,679.2 crore.
At its peak, Tata Sons had an outstanding debt of ₹31,603 crore at the end of March 2020 and a net debt-to-equity ratio of 0.56.
A combination of a debt-free balance sheet and a steadily growing dividend income from group listed companies such as Tata Consultancy Services, Tata Motors, Titan, and Tata Consumer provides financial firepower to Tata Sons to scale up investment in new ventures or step up dividend payouts. Last time when Tata Sons was debt-free on a net basis in FY06, it was followed by a string of large cross-border acquisitions, which transformed the group.
Historically, there is a high correlation between the Tata Sons balance sheet leverage ratio and the pace of its equity investment in various ventures.
A low leverage ratio, such as in 2005-06 and 2014-15, has been followed by a spurt in Tata Sons' equity investment in various listed and unlisted ventures. (See the adjoining charts.) For example, at the end of March 2006, Tata Sons had reported a gross debt of ₹2,316 crore and cash and equivalents worth ₹2,471 crore.
Denne historien er fra October 16, 2024-utgaven av Business Standard.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
Allerede abonnent ? Logg på
Denne historien er fra October 16, 2024-utgaven av Business Standard.
Start din 7-dagers gratis prøveperiode på Magzter GOLD for å få tilgang til tusenvis av utvalgte premiumhistorier og 9000+ magasiner og aviser.
Allerede abonnent? Logg på
Ratan Tata: Picture perfect
Politeness is to human nature What Warmth is to Wax.
I chose DLF over Disneyland dream, says KP Singh
KP SPEAK: Gurugram remains a developing city; urban planning needs a long-term vision, the PM must set up a high-powered panel for it
REDISCOVERY OF INDIA
Indian collectors are reclaiming Colonial-era art created by foreigners as an intrinsic part ofthe country's history
Go for fund with large AUM, high credit quality and low cost
Liquid funds have offered an average return of 7.28 per cent over the past year.
Auto majors in slow lane on weak demand
TaMo, Maruti, SMIL stocks down up to 23% in 4 weeks; analysts say downside risk limited, an opportunity for long-term investors
Volume growth for NMDC to remain robust in H2FY25
NMDC's revenue in Q2FY25 came in at ₹4,900 crore (a rise of 23 per cent year-on-year or Y-o-Y), while it was down 9 per cent quarter-on-quarter (Q-o-Q).
CIEL HR to file draft papers for ₹450 cr IPO
CIEL HR Services (CIEL), which uses technology to provide human resources solutions, will soon file draft papers for an initial public offering (IPO) estimated to be around ₹450 crore in size, according to sources.
Angel funds see red in Sebi's new accredited investors-only proposal
The Securities and Exchange Board of India's (Sebi's) proposal to allow only \"accredited investors\" to invest in angel funds has raised concerns in some quarters, even as most fund managers believe the overall ecosystem was set for a boost.
CLSA does U-turn on China, ups India exposure after Trump win
Says India seen as more attractive investment destination due to its strong economic growth and relatively low exposure to trade risks
Unfazed by mkt fall, largecap, flexicap MF schemes shine in Oct
Both categories saw all-time-high inflows during the month
