0
Group Members:
KOK KEAN TEONG CEA070059
MOH JIA WEI CEA070084
NEO CHING HUP CEA070109
ONG KAH HOEY CEA070157
TEO SILK KEON...
 India’s largest Automobile company
 World’s 2nd
largest bus manufacturer
 World’s 4th
largest truck manufacturer
 Rev...
 Established since 1945
Source: www.advfn.com
 Finance acquisition by using Bridge loan of
US$3billion
Source: www.advfn.com
Source: www.advfn.com
Are they able to pay the loans?
 What are the rationales to buy JLR?
 What are the problems in financing acquisition?
 Does Tata Motors face any proble...
 What are the impacts of global financial crisis on
the developing and developed countries as well as
the automobile indu...
 Want to become a major player in the international
automobile market.
 Fulfill the ongoing strategy of internationaliza...
 Jaguar -“performance/luxury” vehicles
 Benefits
◦ component sourcing
◦ design services
◦ low cost engineering (intellec...
 Main reason:
•Difficult in raising fund
•Increase the risk for calling
default
Problem 1:
Lack of access to credit to repay the
bridge loan of US$3 Billion
Solutions:
Option 1>> Merge with Mahindra & M...
Problem 2:
Global financial crisis > Sales
Dropped
Source: Society of Indian Automobile Manufacturers report and Company A...
Problem 2:
Global financial crisis > Sales
Dropped
Solutions:
• Lay off workers and cut productions
•Launch low budget car...
Problem 3:
Increasing materials and fuel prices
have slow the demand of vehicles
Problem 3:
Increasing materials and fuel prices
have slow the demand of vehicles
Solutions:
• Hedging or Joint Venture wit...
Problem 4:
Share price dropped drastically and
affect its global image
Solutions:
• Boost sales and increase company’s earnings
•Expose the future strategic strategies through media
release
Pro...
Solutions:
•has no power to control this external factor environment
Problem 5:
Relocation of Nano’s factory from West
Ben...
Cultural
pressure for
home
ownership
Buy houses
Homes
perceived as
safe
investment
Low interest
rate
Give more
loans
Capital & credit
availability
Bonus
Management
bonuses
US government
policy to
increase home
ownership
Supply of
loan
increases
Demand of
houses
increases
Housing
boom
House
prices
increases
Bank willing
to take more
risk
Ban...
Tata motors part 1
Tata motors part 1
Tata motors part 1
Tata motors part 1
Tata motors part 1
Tata motors part 1
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Tata motors part 1

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Transcript of "Tata motors part 1"

  1. 1. Group Members: KOK KEAN TEONG CEA070059 MOH JIA WEI CEA070084 NEO CHING HUP CEA070109 ONG KAH HOEY CEA070157 TEO SILK KEONG CEA070197 Faculty of Business and Accountancy
  2. 2.  India’s largest Automobile company  World’s 2nd largest bus manufacturer  World’s 4th largest truck manufacturer  Revenue of US$8.8 billion in FY2008
  3. 3.  Established since 1945
  4. 4. Source: www.advfn.com
  5. 5.  Finance acquisition by using Bridge loan of US$3billion Source: www.advfn.com
  6. 6. Source: www.advfn.com Are they able to pay the loans?
  7. 7.  What are the rationales to buy JLR?  What are the problems in financing acquisition?  Does Tata Motors face any problems after all?  How does the global financial crisis happen?
  8. 8.  What are the impacts of global financial crisis on the developing and developed countries as well as the automobile industry?  How does the macro environment and global business environment influence the success of a business?  Is buying JLR to go global a right move?
  9. 9.  Want to become a major player in the international automobile market.  Fulfill the ongoing strategy of internationalization  Increased business diversity across markets and products.  Land rover fits the SUV segment
  10. 10.  Jaguar -“performance/luxury” vehicles  Benefits ◦ component sourcing ◦ design services ◦ low cost engineering (intellectual property rights).  Improved corporation’s image and increased its public reputation.
  11. 11.  Main reason:
  12. 12. •Difficult in raising fund •Increase the risk for calling default
  13. 13. Problem 1: Lack of access to credit to repay the bridge loan of US$3 Billion Solutions: Option 1>> Merge with Mahindra & Mahindra Option 2 >> Divestment Option 3>> Combination of raising funds from public and refinance Solutions: Option 1>> Merge with Mahindra & Mahindra Option 2 >> Divestment Option 3>> Combination of raising funds from public and refinance 
  14. 14. Problem 2: Global financial crisis > Sales Dropped Source: Society of Indian Automobile Manufacturers report and Company Analysis * including Magic and Winger sales # including Fiat branded cars
  15. 15. Problem 2: Global financial crisis > Sales Dropped Solutions: • Lay off workers and cut productions •Launch low budget cars in the developing countries •Focus on new product development and continue to introduce new products in the marketplace
  16. 16. Problem 3: Increasing materials and fuel prices have slow the demand of vehicles
  17. 17. Problem 3: Increasing materials and fuel prices have slow the demand of vehicles Solutions: • Hedging or Joint Venture with the materials suppliers •Launch new products with fuel economy •Continuous R&D in developing vehicles that running on alternative fuels
  18. 18. Problem 4: Share price dropped drastically and affect its global image
  19. 19. Solutions: • Boost sales and increase company’s earnings •Expose the future strategic strategies through media release Problem 4: Share price dropped drastically and affect its global image
  20. 20. Solutions: •has no power to control this external factor environment Problem 5: Relocation of Nano’s factory from West Bengal to Gujerat
  21. 21. Cultural pressure for home ownership Buy houses Homes perceived as safe investment Low interest rate
  22. 22. Give more loans Capital & credit availability Bonus Management bonuses US government policy to increase home ownership
  23. 23. Supply of loan increases Demand of houses increases Housing boom House prices increases Bank willing to take more risk Banks issue subprime mortgage loans Banks issue adjustable- rate mortgage
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