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| Tata Autocomp feels the heat | |
| BS Reporter / Mumbai December 28, 2008, 0:17 IST | |
The slowdown in the automobile industry has already hit Tata Motors hard. The impact is now being felt by the Tata Group’s automotive component companies.
Credit rating agency Crisil has revised its rating on the long-term bank loan facilities and non-convertible debenture (NCD) programmes of Tata AutoComp Systems (Taco) to ‘AA-/Stable’ from ‘AA/Stable’. The rating on the company’s letter of credit facility has been reaffirmed at ‘P1+’.
Taco is a holding company for joint ventures for manufacture of a variety of automotive components.
Taco has scaled down its capital expenditure plans on account of the slowdown in the automotive sector, but will continue to invest in group companies, many of which are in early stages of operation. The debt protection measures are likely to deteriorate, with a decline in profitability and cash accruals, Crisil says.
The Taco group presently has six domestic operating subsidiaries, two overseas operating subsidiaries, two overseas holding companies, nine operating joint ventures, and one associate company. Meanwhile, the rating outlook on the bank loan facilities of Tata Visteon Automotive (TVAPL) has also been revised to‘Negative’ from ‘Stable’.
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