Tata Capital Financial Services (TCFSL), a wholly-owned subsidiary of Tata Capital, plans to raise capital worth Rs 500 crore through tier-II bonds and scale up business in areas such as loan against properties and affordable housing.
The subordinated debt carries AA+ rating and factors in TCFSL’s strong parentage, according to rating agency CARE Ratings.
The rating factors in the brand equity associated with the Tata group, the experienced management team drawn from the parent, and the strong financial flexibility enjoyed by TCFSL by virtue of being part of the Tata group. The rating also factors in moderate asset quality and the pressure on profitability. Continued parentage and support from the Tata group, profitability and asset quality are the key rating sensitivities.
TCFSL provides a wide spectrum of financial products such as term loans, supply chain financing, construction equipment financing, project loans, home equity loans, personal loans, and consumer durable loans.
The total loan portfolio stood at Rs 23,551 crore as on March 31, 2015. In FY15, its net profit increased nine per cent to Rs 187 crore from Rs 172 crore for FY14. TCFSL’s gross non-performing assets (NPA) ratio in March 2015 was 6.01 per cent.
The subordinated debt carries AA+ rating and factors in TCFSL’s strong parentage, according to rating agency CARE Ratings.
The rating factors in the brand equity associated with the Tata group, the experienced management team drawn from the parent, and the strong financial flexibility enjoyed by TCFSL by virtue of being part of the Tata group. The rating also factors in moderate asset quality and the pressure on profitability. Continued parentage and support from the Tata group, profitability and asset quality are the key rating sensitivities.
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Govind Sankaranarayanan, chief operating officer (retail business and housing finance), Tata Capital, said the company would step up business activity in areas such as affordable housing, personal loans, business loans and loans against property.
TCFSL provides a wide spectrum of financial products such as term loans, supply chain financing, construction equipment financing, project loans, home equity loans, personal loans, and consumer durable loans.
The total loan portfolio stood at Rs 23,551 crore as on March 31, 2015. In FY15, its net profit increased nine per cent to Rs 187 crore from Rs 172 crore for FY14. TCFSL’s gross non-performing assets (NPA) ratio in March 2015 was 6.01 per cent.