TPG Capital’s new climate-focused financial fund, TPG Rise Climate, along with co-investors will invest Rs 7,500 crore in mandatory convertible instruments to obtain between 11 and 15% stake in this company, which will translate into through an equity valuation of up to $ 9.1 billion. .
PB Balaji, Chief Financial Officer and Shailesh Chandra, President of PV Business at Tata Motors, as well as Ankur Thadani, Business Unit Partner of TPG Rise, discussed what this investment means for the electric vehicle ecosystem. as a whole and whether they plan, at any time, to list the newly formed subsidiary.
“Currently the company is now tracking around 1,000 vehicles per month and anywhere between Rs 500 crore and Rs 600 crore is the kind of rate we are currently operating at. More importantly, we’re starting to look at the backlog we’re building – starting to place almost 3,000 to 3,500 orders per month, so if supplies can keep up, we see no reason why we won’t be able to meet. to this command situation, ”Balaji said.
The company says it is starting to see expansion in charging infrastructure as well as new products.
“We see that this growth potential is quite significant in this particular company as we move forward and that is why we believe that now is the right time to start investing in this area and filling the gaps in it. regarding this particular business., ”he said.
TPG sees the investment as a long-term investment and focuses on the electrification and decarbonization of transport.
“The Tata Group has the vision, the commitment, the sponsorship for sustainability, which Tata Motors, led by Shailesh Chandra, PB Balaji and the team, has achieved in terms of market leadership today – we we really see this as a long-term investment bet that we are making with the group and with the company to achieve this imperative global solution, which is to electrify our transport, ”said Thadani.
“We want to be a force multiplier for companies like these and generate not only very good financial returns, but also very good social and economic returns for society,” he added.
Tata Motors has a full plan for its eclectic foray and it will evolve in phases – from the first to the third generation. Third-generation products will begin to evolve into electric vehicles that will be optimized, made more efficient in terms of cost and performance, according to management.
“This will take full advantage of the new technologies that will be the future in the electric vehicle arena and this is how we will be working for these ten products that we have talked about during the next five year plan,” Chandra said. Explain.
According to Chandra, the Indian market has a great opportunity right now in the next decade thanks to the internal combustion engine (ICE) as well as the EV space for passenger vehicles.
“We can expect twice the growth over the next 10 years for the PV industry in India. 1.5 times would come electric vehicles. So there is an opportunity for growth in both segments, ”he said.
In terms of listing plans, Balaji said, “At the moment there are no plans to list an entity. Our job is to win first with clients and there are very clear strategies for each of the companies, CV will have to win decisively, PV will have to win sustainably and EV will have to win proactively. Discovering value, unlocking value are separate conversations and it will happen when the board, in their wisdom, decides when they want to do it.
For the full discussion, watch the accompanying video.
(Edited by : Abhishek Jha)