Tata Capital raising $100 m in ECB


MUMBAI, Mar 24: Tata Capital, the financia  services arm of the diversified conglomerate, will be raising

USD 100 million in foreign borrowings through an arm by next week, a top official has said.
The external commercial borrowing (ECB) being raised

by Tata Capital Housing Finance is part of a liabilities

diversification programme, Tata Capital managing director and chief executive Rajiv Sabharwal said.

“We will do a borrowing of USD 100 million before the

end of the fiscal year,” Sabharwal told PTI recently.

The ECB funds will come right after a Rs 2,500-crore

capital infusion by the parent Tata Sons in two tranches through the course of the fiscal, he said.

Sabharwal said as part of liability diversification, the company also completed its maiden non-convertible

debenture issue last September, raising Rs 1,400 crore. Asked if the liability diversification is the result

of the squeeze in credit markets after the IL&FS crisis, he replied in the negative, stating that the company had already drawn up plans to diversify its borrowing sources.

The September 2018 liquidity crisis did not have any

impact on the company, he said, adding they had resorted to

drawdown of bank credit lines as the reliance on mutual funds had to be limited.

However, cost of funds went up during the trouble period, but of late the rates have been coming down, Sabharwal said.

The company is targeting 25-30 per cent credit

growth for FY20 and he hinted that this capital raised will

suffice for at least one year given the credit growthtarget.

Sabharwal, however, declined to comment when asked

about additional capital raising plans and if the promoter

will be looking at a listing eventually.

At present, 60 per cent of its book is devoted to the

retail segment, 25 per cent to small and medium enterprises

while corporate and infrastructure account for the remaining

15 per cent, Sabharwal said, pointing out that broadly, the

book composition will be maintained.

Asked about reports of a slew of changes in

regulations governing non-banking lenders segment, Sabharwal

said the company does not see any adverse outcome from it.

An asset quality review which has been speculated

about multiple times will also not be a problem for the

company, he stressed. (PTI)