Fitch Ratings Thursday revised the outlook on Tata Motors to 'negative' from 'stable' on expectations of rising negative free cash flow in the current and the next financial year, following upward capex revision at subsidiary Jaguar Land Rover.
In a statement, Fitch said it has affirmed its long-term issuer default rating of 'BB+' to Tata Motors.
"The revision of the outlook reflects Fitch's expectations of rising negative free cash flow (FCF) over the fiscal years ending March 2019 (FY19) and FY20, following upward capex revisions at Tata Motor's fully-owned subsidiary, Jaguar Land Rover Automotive plc," it said.
Free cash flows are likely to improve post FY20, but "the ratings may be downgraded if we believe Tata Motor's FCF is not likely to improve in line with our expectations," Fitch said.
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