CARE assigns ‘CARE AA+’ rating to Tata Capital’s proposed NCD issue

CARE has assigned ‘CARE AA+’ rating to Tata Capital’s (TCL) proposed NCD issue of Rs 250 crore. The rating factors in TCL’s strong parentage (TCL being subsidiary of Tata Sons), demonstrated support of the Tata group, both, by way of capital support as well as by providing in-house business opportunities. The rating also factors in the brand equity of the parent company which would aid TCL in scaling up its volumes beyond the group related business as well as render it with strong resource raising capabilities.

The rating is however constrained by TCL’s limited track record of operations, its ability to lend competitively given the presence of established players in an intensely aggressive corporate and retail lending market and maintain its spreads and its ability to maintain asset quality with rising business volumes.

TCL is a subsidiary of Tata Sons providing a wide spectrum of financial services (both fund based as well as non-fund based). TCL is having / planning to have the various business verticals like Retail Finance, Construction Equipment Finance, SME loans, Distribution and Broking of Financial Products, Wealth Management, Investment Banking and Private Equity either on its books or its subsidiary companies.