"We have submitted a proposal and are waiting for ministry clearance. It depends entirely on how much the ministry will allow us to repurchase," senior company officials told The Financial Express. Telco's forex loans stand at around $240 million. In the last 12 months, the company repurchased bonds worth $80 million from its 10-year, $200 million ECBs raised in 1997.During the current fiscal, Telco has bought back another $6-7 million worth of bonds from the secondary market.

"It is a company policy to reduce our reliance on foreign-currency loans in view of the fact that the forex market is still volatile. Any further depreciation of the rupee will increase the hedging cost and in turn the overall cost of funds," said a senior company official. "A triple-A ratedcompany can raise forex loans within 7 per cent, but if you include the hedging cost of another 5.5 per cent, it works out to around 12-12.5 per cent. Any triple-A company in India can raise medium-term loans at 12.5 to 13 per cent." he said.

Telco's average cost of borrowing is around 11.2 per cent, already among the lowest in corporate India, for its total outstanding debt of Rs 3,400 crore which includes forex loans. It is now striving to reduce the cost of borrowing further.

The company is currently negotiating with financial institutions to retire some of its high-cost domestic debt. "Some of our debentures have high coupon rates. We are talking to FIs in case the penalty clauses can be avoided," the official said.

During the first quarter, Telco retired around Rs 1,400 crore of short-term borrowings from the Indica booking proceeds. In the process, the auto major saved around 200 basis points annually.

Telco has drafted a capital expenditure plan of around Rs 750 crore annually for the nextthree years, much of which will go towards bringing out Indica variants and modified versions of other existing models.

Though a large portion of the capex plan will be financed through internal generation, the company may borrow a portion of the amount from within the country. "Our debt-equity ratio stands at 0.9:1, and we would not like it to exceed 1.1:1," company officials said.

Telco has also stepped up efforts to push higher numbers into the export market. It has already begun exports of the Tata Safari and the company said that total forex earnings in the first quarter has been higher than that in the corresponding period of last fiscal.