The newly rechristened Tata Motors has decided to utilise the entire $100 million it raised through the issue of foreign currency convertible bonds last month to retire its high-cost debts. With this move, the company is hoping to retire at least Rs 400-500 crore (Rs 4-5 billion) of its expensive debt.

The automobile maker was earlier contemplating utilising the funds for capital infusion, product development and retiring high-cost debts but has finally decided on using the entire amount for debt restructuring.

Praveen Kadle, executive director, Tata Motors, said: "We will utilise the $100 million we raised through the FCCB issue to bring down the effective yield of our high-cost debt component to 4 per cent, while the average cost of our debt at present is around 12-13 per cent."

The company managed to bring down its loans, both secured and unsecured, from Rs 2,304.96 crore (Rs 23.05 billion) to Rs 1,458.31 crore (Rs 14.58 billion) in the last fiscal. It also managed to retire Rs 150 crore (Rs 1.50 billion) of high-cost loans in the first quarter of this year through internal accruals.

Besides pruning its debt portfolio, the company has a number of other plans lined up for the year. Two new cars from the Tata Motors stable -- Indigo Estate and Indica Sport -- will hit the roads in the last quarter of this year. The company is also launching a petrol version of its popular utility vehicle Tata Safari.

On the export front too, the company has plans to go global in a big way by doubling its export revenues over the next three years. The company, the largest commercial vehicle manufacturer in the country, currently exports 7-8 per cent of its total production. It is hoping to export its entire range of passenger cars to Europe under its much publicised tie-up with MG Rover.

The company is also one of the three bidders for the South African government's national transport privatisation project. The project, looking for mass transportation solutions in South Africa, involves the export of medium commercial vehicle and light commercial vehicle and has been under consideration for nearly two years now.

DaimlerChrysler and the Italian commercial vehicle manufacturer Iveco are the other bidders in the fray.