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Tata Motors' Extends Fall On Fears Of Downgrade By Fitch Ratings

Roshni Agarwal

The shares of Tata Motors in intra-day trade on Monday continued their last week's losing streak after global ratings firm Fitch Ratings included the stock in its negative watch list. The stock in the opening trade declined 3.2% but recovered early losses and was quoting higher at Rs. 152.55, up 1.23% at 3:11 pm.

On Friday, Tata Motors plummeted a sharp 17.58% on the NSE, logging its worst one-day loss, after the company reported the highest ever quarterly loss.

Fitch Ratings report highlights that increasing uncertainties concerning a hard Brexit might substantially impact the profitability of Tata Motors' subsidiary firm, Jaguar land Rover. "Fitch Ratings has placed Tata Motors' Long-Term Issuer Default Rating of 'BB' on 'Rating Watch Negative' to reflect the increasing risks of a disorderly Brexit for its fully-owned subsidiary Jaguar Land Rover Automotive," it said in a statement.

In accordance with the company's filings with the exchange, about 80% of the business for Jaguar Land Rover comes from Europe and the UK.

The decline in sales of JLR in China is another concern and if the company fails to recover its lost sales there, it will be a big negative for the company's rating.

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JLR Sales Rise By 11.9%; Stock Of Tata Motors Surges