Moody's lowers Tata Motors

Moody's Investors Service said it downgraded the corporate family rating of Tata Motors Ltd. to B3 from B1.

The outlook remains negative.

"The rating change reflects TML's limited financial flexibility, high gearing as well as imminent refinancing risk in the context of weak market conditions in India and overseas," Elizabeth Allen, a Moody's vice president, said in a statement.

"The significant decline in sales volume challenges the company's ability to achieve cash flow and profitability breakeven and thus a reliance on debt funding," Allen said.

The rating also incorporates the company's strong market position in India as well as support from Tata Sons Ltd. (unrated), the agency said.

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