Tata Motors to push for electric vehicles by raising $1 billion

Tata Motors is looking to shift to the next gear in the electric vehicle (EV) space by raising $1 billion through stock sale of its EV unit, the Times of India reported on Friday. The fund raise proposed will value the company’s electric value unit at $8 billion and has attracted multiple equity funds from US, Middle East and Southeast Asia. To lead the financing exercise, the company has had discussion with Texas Pacific group (TPG), California Public Emoloyees Retirement System, Temasek am0ng others.

The company is planning to have at least 10 electric vehicles by 2025, with the investment coming into its step-down electric vehicle arm. In FY 21, sales of electric vehicles were just 2%.

Tata to launch another electric vehicle ‘Punch’

At present, Tata Motors has three electric car models, Nexon, Tigor and Xpress T Sedan. Among the three, Nexon is the top seller in Indian electric passenger vehicle market and has clocked sales of more than 7,000 units, since its introduction in January 2020. It will most likely launch another SUV called Punch.

With a commanding 70% market share in the electric four wheeler space, the company has been strengthening its sister concerns like Tata Power for charging infrastructure, Tata Chemicals for battery cells, Tata Motors Finance for financing and Croma for retailing, to expand its electric vehicle play.

Back in July, Tata Motors chairman N Chandrasekaran, had said that the company would look to raise capital for the electric vehicle business and it expects a quarter of sales to come from the same in the near future.