Tata Motors to raise Rs 500cr via non-convertible debentures

Tata Motors Ltd on Thursday noted a 6.1% plunge in overall sales to 72,753 units in April 2025.

Board Approves NCD Issuance Through Private Placement

Tata Motors Ltd announced on Friday that its board has approved the issuance of non-convertible debentures (NCDs) worth up to ₹500 crore. The decision was taken during a brief meeting of the board committee held on May 2, 2025. The NCDs will carry a fixed annual coupon rate of 7.08% and will be issued via private placement in two separate tranches.

Structure and Maturity of Tranches

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According to a regulatory filing, Tranche I will involve the issuance of up to 30,000 NCDs with a face value of ₹1,00,000 each, amounting to ₹300 crore. Tranche II will consist of 20,000 NCDs, also of ₹1,00,000 face value, totaling ₹200 crore. Allotment for both tranches is scheduled for May 13, 2025.

Tranche I NCDs will mature on May 11, 2028, while Tranche II will reach maturity a day later on May 12, 2028. Interest will be paid annually, and the principal will be repaid in a single bullet payment upon maturity.

Key Features of the NCDs

The debentures are described as unsecured, listed, rated, and redeemable. Tata Motors plans to list them on the wholesale debt market segment of the National Stock Exchange (NSE), providing institutional investors with an opportunity to participate in the offering.

Sales Performance in April 2025 Declines

The announcement comes a day after Tata Motors reported a 6.1% year-on-year decline in total sales for April 2025. The company sold 72,753 units in the month, down from 77,521 units in April 2024. The dip in sales may have influenced the company’s decision to raise funds through debt, as it continues to invest in operations and future growth initiatives.