Niskalp No Longer Tata Finance Arm

Mired in controversial transactions with parent Tata Finance, Niskalp Investments & Trading Company Ltd was de-subsidiarised.

Tata Finance no longer holds 99.4 per cent in Niskalp. Another Tata group company, Ewart Investments, picked up a shade over 50 per cent in Niskalp for Rs 39.85 crore.

Tata sources said it is part of the restructuring exercise of Niskalp which is an investment company registered with the Reserve Bank of India.

It is into various activities in the financial markets including asset financing. In fiscal 2000, it had posted a net profit of Rs 52.70 crore but it subsequently slipped into the red.

According to sources, Tata Finance had advanced a clean inter-corporate deposit (ICD) of Rs 39.85 crore to Ewart Investments, a wholly owned subsidiary of Tata Sons. Ewart Investments, in turn, invested this in Niskalp.

The move to demerge Niskalp has done with a view to improve the capital adequacy ratio of Tata Finance.

The losses of Niskalp are a concern for the Securities Exchange Board of India. The Sebi had pulled up Tata Finance at the time of its rights issue in April 2001 to disclose the losses of its subsidiary Niskalp, which the company had evaded.