The Car that Could Save Tata Motors from Financial Decay

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This business is worth billions, but the debts keep rising and this makes the auto company to lose its
worth in 2020. Unless a drastic step is taken to save the unit, business may never be the same for
the group. Many businesses are finding it increasingly hard to keep their heads above water and
Tata Motors is not an exception. New information from claims capital market CLSA, shows the
business can be saved through the help of Jaguar Land Rover (JLR).

JLR is the luxury unit of the group and there is also the parent firm Tata Sons Pvt Ltd. The automobile
business has already received stimulus from the parent firm. That was given in form an allotment or
equity and according to CLSA, it is possible that the automobile company receive further aid.
Now, JLR remains the sole driver of Tata Motors valuation, so without its help, the unit becomes
nothing. Analysts believe that that the future of the corporation is only through bright equity
infusions, especially when it is used to support loss funding. So far, the Indian Motor company has
no value whatsoever. As in most countries worldwide, Indians are demanding fewer cars, and this
has been the norm for almost two years. In April 2020, even the top sellers in automobiles could not
ship cars to dealers in India. With a decline of over 50 percent, Tata Motors is one of the biggest
losers in the industry this year.

Tata Motors is looking for a way out of its challenges for months. A strategic partner could well turn
things around, but the company vowed it would not give up JLR as that seems to be the only
worthwhile possession of the establishment. Tata’s plans to deleverage may not occur as soon as the
management wants it. The management may have to wait for up to year before things look up and
that doesn’t appear attractive to the unit.

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JLR’s ability to help Tata Motors sort out its financial rut may be encouraging, seeing that the
establishment plans to plug in hybrid technology into its product. The unit is also planning to start
production on May 18. Furthermore, the new model can enhance electrification and the downsizing
to low CO2 of about 32/km. It is intended to woo buyers looking for neo technology in cars. Once
users can see the importance of the new technology, they may increase the demand for cars later
this year.

The company was founded in 1945 as a branch of Tata Group as it was meant to manufacture
locomotives. Further down the line, it made a partnership with Daimler Benz AG and that led to its
first commercial vehicle constructed in 1954. This establishment has committed to government’s
policy of e-mobility by 2030 and it continues to work to build a lasting future for India automobile
industries. As such, it is bracing up to introduce many electric cars for the future and now, it is
working on several electric cars projected for attracting buyers in the future.

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