Tata Capital Plans To Raise $3.38 Bn Mainly Through Debt Instrument

Tata Capital Limited, the Mumbai based financial and investment service provider, is planing to raise 280 billion rupees (US$ 3.38 billion) mainly through debt instruments and bank lines in the current financial year to fund its double-digit credit growth, said a Reuters report citing Rajiv Sabharwal, managing director and CEO of Tata Capital.

In an interview with Reuters, the Tata Capital CEO said, "We try to remain granular and well-spread out on our liabilities whether it is bank funding, NCDs (non-convertible debentures), external commercial borrowing or public debt issue".

Explaining that liabilities will have to match with the company's AUM (assets under management), Sabharwal said, "If credit is expected to grow at around 15%, we will try to grow our AUM (assets under management) by more than 25%."

Stating the company's inclination towards retail sector, Sabharwal further said that the contribution from the retail segment could raise to around 85%, while the remaining 15% will be in corporate.

Tata Capital will deliberately choose companies that are safe and belong to large groups and do not intends to increase its exposure to corporates rated AA and below.

The group's consolidated loan book was 1.28 trillion rupees at the end of June, with more than three-fourths comprising secured loans.

A subsidiary of Tata Sons, Tata Capital offers consumer loans, wealth management, commercial finance, and infrastructure finance, among others.

Tata Capital, registered as NBFC with the RBI, has three subsidiaries – Tata Capital Housing Finance, Tata Capital Financial Services and Tata Cleantech Capital.

Very recently, a subsidiary of Flipkart co-founder Sachin Bansal’s Navi Group, which is also one of the partners of Tata Capital, has been acquired by Ananya Birla’s Svatantra Microfin Private Limited.

Meanwhile, Tata Capital aims to expand its wealth management business, and foray into education financing this year, said Sabharwal to Reuters.


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