Tata’s rating down after Nano launch

Contrary to hopes, Standard & Poor’s, global ratings agency, cut the ranking of Tata Motors after the glitzy lauch of Tata Nano. S&P cleared that it did not comment on credit rating changes. S&P analyst Manuel Guerena explained that a material deterioration in cash flow, a difficult operating environment and high debt for cutting Tata Motors's rating to B+ from BB-. It is also suggested that the Tata Nano would contribute little to profits soon despite hopes. Tata Nano’s British luxury marques Jaguar and Land Rover have been badly effected by a slowing domestic economy and the deepening global financial crisis at the same period.

The company is still working to refinance the two billion dollars outstanding from a three billion dollar loan it took to pay for those acquisitions. Bankers have said the bridge loan issue must be resolved by early June.

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