The Hindu Business Line : Tatas plan foray in global financial services

Finding base
Tata Capital Pte to be TCL’s global headquarters
Sees big potential for fee-based, fund-based activities
May pitch for fundraising activities of group cos

Our Bureau

Advertisement

Mumbai, July 12 Buoyed by its successful overseas forays in the manufacturing sector, the Tata Group is now testing the waters in international financial services.

The group’s newly set up financial services arm — Tata Capital Ltd (TCL) — is all set to float a subsidiary in Singapore. A senior Tata official told Business Line that TCL, a wholly owned subsidiary of Tata Sons, has received the Reserve Bank of India approval to float a Singapore subsidiary.

Tata Capital Pte Ltd, Singapore, which will be the global headquarters for TCL, will focus on investment banking, asset management business, and private equity and advisory business, said the official, who declined to be quoted. Apparently, a senior official from within the group will be appointed head of the Singapore unit.

Despite the current turmoil in international financial markets, there is huge potential for both fee-based and fund-based activities overseas, he said.

According to analysts, Tata Capital may pitch for some of the fundraising activities of the group companies, which have made large international acquisitions in the recent past. Tata Motors, which acquired the iconic UK brands Jaguar and Land Rover, had announced major fundraising plans in India and abroad.

TCL, which started operations less than a year ago, already has a presence in London, Tokyo and Singapore through representative offices. It recently tied up with Mizuho Securities Co Ltd in Japan for jointly exploring opportunities in investment banking, broking, wealth management and private equity.

India services

In India, TCL, registered as an NBFC with RBI, offers a whole range of financial services including broking, retail and corporate loans, investment and merchant banking services, and distribution of third party financial products.

TCL is also an equity partner in a new joint venture floated by the rating agency Crisil with the US company Equifax, for setting up a credit information company for rating retail borrowers.

The Tata group earlier had a listed NBFC, Tata Finance Ltd, which was merged with Tata Motors after it suffered huge losses. Its Managing Director, Mr Dilip Pendse, was sacked for financial irregularities and violation of regulations. Tatas had recapitalised the company and paid back all its depositors and creditors.

TCL was launched with an entirely new team headed by Mr Praveen Kadle, former director of Tata Motors. The company now plans to create a large network of retail outlets to offer broking services.

TCL’s overseas ambitions are in line with the group’s international strategy. Currently, more than 65 per cent of the Tata group’s turnover of Rs 2,31,000 crore comes from international operations; this share is expected to go up with the group’s recent acquisition of Jaguar and Land Rover.

More Stories on : Financial Services | Financial Markets | Outlook

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Tatas plan foray in global financial services

Railways may procure bio-diesel at Rs 31.34/litre

Weekly News Round-up

Exchange-traded currency futures likely to take off by mid-August

Nuclear power prospects uncertain: Worldwatch Institute

Geojit reports 55% drop in net

Silk exports post 25% growth despite strong rupee

Institutional investors buy ‘out-of-favour’ sectors in July