Jaguar Land Rover likely to invest Rs 23,300 crore in FY14

Tags: News

Tata firm to speed up development of products in new segments

Tata Motors-owned Jaguar Land Rover is expecting to invest around £2.75 billion (over Rs 23,300 crore) during 2013-14 financial year on development of new products, expand Chinese business and explore production bases in new markets among others.

The British auto major is looking to invest around £2 billion during the current financial year.

“...We expect that our capital spending could increase to be in the region of £2.75 billion in financial year 2014,” Jaguar Land Rover (JLR) said in an investor presentation. The company plans to continue increasing and accelerating capital spending to develop new products in new and segments, invest in new powertrains and technologies to meet customer and regulatory requirements, grow its manufacturing footprint in China and explore manufacturing opportunities in other markets, it added.

“In financial year 2013, we continue to estimate total capital spending will be in the region of £2.0 billion,” JLR said, adding out of this about 50 per cent will be for R&D and 50 per cent will be for expenditure on tangible fixed assets such as facilities, tools and equipment.

“We continue to have a longer term capital spending target of 10-12 per cent of revenue, which we believe is in line with other premium competitors, but in the near and medium term, we expect our capital spending to be a greater percentage of revenue in order to realise the present opportunities we see for growth,” the company said.

Talking about its source of funding, JLR said it continue to target doing most of its capital spending out of operating cash flows. “After capital spending in the region of £2.75 billion pounds in financial year 2014, free cash flow could be negative. We expect that our strong balance sheet and liquidity (£2,176.5 million of total liquidity and £795.0 million of undrawn committed credit lines with two and four years remaining as of September 30, 2012) as well as proven access to funding from capital markets and banks would also support our investment plans as required,” it added. JLR had earlier said it would roll out 40 new products in the next four-five years.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • This is right time for retail investors to enter the debt market

    Quite often, retail investors are ridiculed for entering the equities market in droves, signalling the first signs of a bubble on the Street.

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Arun Nigavekar

Cost of education must be controlled

In India, we pay very little attention to the cost ...

Zehra Naqvi

What imperfections in nature teach man

Each one of us has faced a time when we ...

Dharmendra Khandal

A wondrous world under the ground

Burrows and dens are safe homes for many kinds of ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture