S&P upgrades Tata Motors’ rating to ‘BB/Positive’
09 Jul 2012
Global rating agency Standard and Poor's (S&P) has upgraded Tata Motors' long-term corporate credit rating to 'BB' from 'BB-', and revised the outlook to 'Positive'.
''We expect Jaguar Land Rover plc (JLR is Tata Motors' fully owned UK subsidiary) to sustain its improved operating performance, underpinned by strong sales across geographies. Also, Tata Motors' competitive position and cash flow stability have improved'', a statement released by S&P said.
JLR, which accounted for about 60 per cent of Tata Motors' consolidated revenues and two-thirds of its EBITDA in the fiscal year ended 31 March 2012, has outperformed S&P's expectations.
''We are raising our long-term corporate credit rating on India-based Tata Motors to 'BB' from 'BB-'. We are also raising the issue ratings on the company's senior unsecured notes to 'BB' from 'BB-' '', it said.
''The positive outlook reflects our expectation that Tata Motors will sustain its improved operating performance and maintain debt protection measures commensurate with the rating'', the rating major added.
It said the company's business risk profile is 'fair'.
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