INSUBCONTINENT EXCLUSIVE:
Mumbai: Moody's Investors Service has placed the ratings on Tata Motors on review for a possible downgrade.
The review, which will be
completed over the next 90 days, is on the Ba3 corporate family rating and Ba3 senior unsecured debt rating,Moody's said in a
global markets and government's containment measures including some government support as well as its countermeasures and liquidity
profile.
On the rationale for a possible downgrade, Moody's cited the rapid and widening spread of the coronavirus outbreak, deteriorating
global economic outlook, falling oil prices, and asset price declines, which are creating a severe and extensive credit shocks across many
reflects the impact on the companies of the breadth and severity of the shock, and the broad deterioration in credit quality it has
coming months, especially in the EMEA and North American markets
This is likely to extend through the early summer at least, with a reasonable recovery from the low points commencing then
extended production shutdowns and a much delayed demand recovery for its wholly-owned subsidiary, Jaguar Land Rover.
JLR's British plants
are mostly closed, as are units along the broader auto supply chain
This should enable field inventories of unsold units to be somewhat restrained , but also lead to potential disruption even after new
recovery in the third quarter, however the risk to the downside is considerable and further downside scenarios given the uncertainty on the
Nevertheless, these markets also face downside risks in terms of the pace and magnitude of the demand recovery.
