Business Case Studies, Financial Management & Corporate Finance Case Study, Tata Steel, External Commercial Borrowings

print page
Tell A Friend
Bookmark
 

Case Categories

Financial Management & Corporate Finance Case Study

Case Title:

Tata Steel’s External Commercial Borrowings: The Payoffs

Publication Month & Year : July 2009

Authors: Mora Sowjanya & D. Satish

Industry: Steel

Region:India

Case Code: FM0005

Teaching Note: Available

Structured Assignment: Available

Buy This Case Study
OR



Abstract:
The main objective of this case study is to understand the redemption pressures encountered by the Indian entities in paying back the external borrowings. With the initiation of liberalisation policies, the Indian financial markets had experienced remarkable changes and Indian companies started borrowing and investing abroad.Many Indian companieshave raised substantial amounts of external borrowings through External Commercial Borrowings (ECBs) for their long-termrequirements.One such company,Tata Steel Ltd. raised $500 million to support its acquisition of Corus in 2007. However, the recent financial crisis and subsequent effects – increased cost of borrowings, rupee depreciation and erratic exchange rates – hit the companies that raised funds through ECB route. In thewakeof liquidity crisis, it is to be seen as to how companies, in particular Tata Steel Ltd., canmanage the redemption pressures.

Pedagogical Objectives:

  • To understand the need and importance ofECBs and its merits over other available fund raising options
  • To assess the potential of ECBs for funding foreign acquisitions
  • To assess the efficacy of Tata Steel's ECBs in the light of its expansion efforts.

Keywords : External Commercial Borrowings; Indian Financial Market; FCCBs; Foreign Currency Convertible Bonds; LIBOR; Currency fluctuations; Interest rates; Course Case Maps; MBA; Financial Management; Financial Management Course Case; Finance for Managers; Course Case Packs; Managerial Finance; Business Finance; Corporate Finance; Principles of Financial Management; Financial Management Course Case Pack

Recently Bought Case Studies

    Recently Bought Case Studies
advertisement

    Executive Interviews

  • Al RiesAl Ries

    Chairman of Ries, an Atlanta-based marketing strategy firm
    Speaks on Brands and Branding
  • Michael BrimmMichael Brimm

    Prof. Michael Brimm is Emeritus Professor of Organization and Management at INSEAD.
    Speaks on Managing Complexity
  • W Chan Kim & Renee MauborgneW Chan Kim & Renee Mauborgne

    Co-Founders and Co-Directors of the INSEAD Blue Ocean Strategy Institute.
    Speaks on Blue Ocean Strategy
  • View All Executive Interviews»



Contact us: IBS Case Development Centre (IBSCDC), IFHE Campus, Donthanapally, Sankarapally Road, Hyderabad-501 504, Andhra Pradesh, INDIA.
Mob: +91- 9640901313, Phone: +91 - 08417 - 236672, Fax : + 91 - 08417 - 236674
E-mail: casehelpdesk@ibsindia.org

©2003-2013 IBS Case Development Centre. All rights reserved. | Careers | Privacy Policy | Terms of Use | Disclosure | Site Map xml sitemap