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Tata Motors sets up electric vehicle arm in India

By Munikoti Rochan

07:36, 23 December 2021

A file image of Tata Motors' megapixel electric concept vehicle displayed at a motor show in Thailand in 2012.
TPEML will design and build Tata’s electric vehicles – Photo: Shutterstock

Automotive giant Tata Motors has incorporated a new subsidiary in India that will design and build electric motor vehicles in the sub-continent.

The Jaguar Land Rover (JLR) parent said the wholly-owned subsidiary – Tata Passenger Electric Mobility (TPEML) –  has been incorporated with an initial capital of INR7bn ($93m).

TPEML will “manufacture, design, develop all kinds of services related to electric vehicles/electric mobility, hybrid electric vehicles of all kinds and all descriptions”, according to a 22 December regulatory filing.

The seller of the Nexon electric sport utility vehicle (SUV) and the Tigor electric saloon has a market capitalisation of roughly INR1.8trn on the National Stock Exchange (NSE), where its stock has rocketed some 154% to INR474.25 so far this year.

Raising funds for electric vehicles

The Indian automaker raised funds in October to grow its fledgling electric vehicles (EV) business in the country.


475.08 Price
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In a 12 October regulator filing, Tata Motors said it had raised INR75bn, from TPG’s Rise Climate Fund and Abu Dhabi’s state holding company ADQ, to expand the eco-friendly mobility business, valued at $9.1bn back then.

The company told shareholders the fundraiser was part of an INR160bn plan to build seven electric vehicles with different body styles, expanding the range to 10 cars over five years.

The management said it chose to tap climate-focused funds for the EV expansion because it believes such funds can help “sharpen (the firm’s) focus” on clean mobility.

Read more: Indian investment banks’ 2021 fee pool Read more: Indian investment banks’ 2021 fee pool $1bn as volumes risebn as volumes rise

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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