Tata Motors hits speed bump ahead of meet on rights issue

Shares of Tata Motors today slipped over three per cent today ahead of its board meeting on Rs 7,500-crore proposed rights issue.
A meeting of the board of directors of the company would be held tomorrow to consider and approve details of the proposed Rs 7,500 crore rights issue, including fixing the issue price.
Shares of the company opened on at Rs 551.00, then lost further ground and slipped 4.15 per cent to touch an intra-day low of Rs 528.50. The stock, however, recovered some lost ground and ended trading at Rs 532.90, down 3.27 per cent on the BSE.

The company's board would also consider buy-back of secured non-convertible debentures of face value of Rs 1,250 crore issued by the company in May 2009, which are to mature on March 31, 2016.
"The exercise is part of its debt restructuring programme to ensure a healthy debt equity mix, balanced maturity profile, better terms that would include lower cost of debt," the company had said in a regulatory filing.
The Mumbai-based company intends to utilise Rs 7,500 crore to fund various activities, including introduction of more than 100 new commercial vehicles over next three years and passenger vehicles on new modular platform from FY 2016-17.

The company, which recently announced a voluntary retirement scheme for its workmen to cut costs, also intends to use the funds to expand in international markets.