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Tata Motors on course to zero net debt by FY24: Chandrasekaran

The company’s net auto debt, including leases, rose to `48,679 crore in FY22, from `40,876 crore in FY21 and `48,282 crore in FY20.

Tata Motors, which now operates as three independent business units, is set to become a near-zero net automotive debt company by FY24.

“Each of these businesses are self-sustaining, which gives me the confidence that we will get to near zero net automotive debt by FY24,” Tata Motors’ chairman and non-executive director N Chandrasekaran said in the company’s annual report for FY22.Tata Motors is now operating as three independent business units — commercial vehicles (CV), passenger vehicles (PV) and Jaguar Land Rover (JLR) — offering differentiated value propositions to customers, while leveraging backend and corporate synergies where possible. “This has made Tata Motors lean, nimble and customer-centric,” he added.

The company’s net auto debt, including leases, rose to `48,679 crore in FY22, from `40,876 crore in FY21 and `48,282 crore in FY20.The last financial year (FY22), which was riddled by global challenges, also saw the Tata Motors operationalising two subsidiaries — Tata Motors Passenger Vehicles, to focus on passenger vehicles powered by internal combustion engines, and Tata Passenger Electric Mobility, to focus on accelerating the passenger electric vehicles business.

“The financial year 2022 was a busy year for your company as it navigated these challenges (global pandemic, military conflict and supply chain shortages, among others) to successfully strengthen the fundamentals of the business,” Chandrasekaran, who is the chairman of Tata Sons, the investment-holding company of the Tata Group, said.“Despite the margins being impacted by supply chain issues and runaway commodity inflation, our India business ended with strong free cash flows of `1,879 crore. We are committed to restoring the profitability of this business as it returns to competitive growth and inflation stabilises,” he added.

According to Shailesh Chandra, managing director, Tata Motors PV and Tata Passenger Electric Mobility, “FY22 has been yet another challenging year for the passenger vehicle industry. Returning to the growth track in FY22 after two years of decline, the industry wholesale grew by just 13% vis-à-vis FY21 and retails remained flat vis-à-vis FY21.”According to JLR’s CEO Thierry Bollore, by the end of March 2022, the company received more than 45,500 customer orders for its new Range Rover, and the company expects demand to remain strong.

“And as we work relentlessly on Jaguar’s renaissance as an all-electric modern luxury brand from 2025, I can assure you that we are absolutely on track,” Bollore added.

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