H C Singh

Steep decline in Tatas Net Worth

It has been pointed out by Mobis Philpose and Ravi Anantha- Narayan in Mint magazine that “Tata Motors tangible net worth goes negative”. Tata Motors debt as of today is Rs 34,974 crore, borrowing from 24 Banks, including State Bank of India, Citigroup inc, Standard Chartered and JP Morgan Chase & Co. Tata Motors could go bankrupt if the Banks had denied loans or tried to recover loans already paid. “The reason Banks aren’t running scared yet is the strong backing of the parent group Tata Sons Ltd” Banks think that under no circumstance the parent Company will let one of its companies (Tata Motors) default or go bankrupt.

However the final comments of the authors of the article named above is that “Losses continue to mount at JLR (Jaguar Land Rover) and they could be an instance of playing with fire for banks and equity in vesters.”

From the above strongest ever remarks for any Tata Company it appears that Tata Motors are in deep trouble and could go bankrupt. If it happens (Tata Sons don’t save Tata Motors) it will be unprecedented and will have impact on other companies and industries which are struggling but are in heavy debt from the Banks or other sources.

September 17, 2009 - Posted by | India | , ,

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