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Tata Motors Ltd (NYSE:TTM)
Cash Flow from Investing
$-4,902 Mil (TTM As of Dec. 2014)

Cash Flow from Investing covers the cash a company gains or spends from investment activities in financial market and operating subsidiaries. It also includes the cash the company used for property, plant and equipment (PPE).

For the three months ended in Dec. 2014, Tata Motors Ltd spent $770 Mil on purchasing property, plant, equipment. It gained $0 Mil from selling property, plant, and equipment. It spent $0 Mil on purchasing business. It gained $0 Mil from selling business. It spent $81 Mil on purchasing investments. It gained $0 Mil from selling investments. It paid $440 Mil for net Intangibles purchase and sale. It paid $0 Mil for discontinued investing activities. And it received $595 Mil from other investing activities. In all, Tata Motors Ltd spent $696 Mil on investment activities in financial market and operating subsidiaries for the three months ended in Dec. 2014.


Definition

Cash Flow from Investing covers the cash a company gains or spends from investment activities in financial market and operating subsidiaries. It also includes the cash the company used for property, plant and equipment (PPE).

If a company spends cash on property, plant and equipment (PPE), this will reduce their cash position. This is called Capital Expenditures (CPEX).

Likewise, if a company buys another company for cash, this will reduce their cash position.

Tata Motors Ltd's Cash Flow from Investing for the fiscal year that ended in Mar. 2014 is calculated as:

Cash Flow from Investing(A: Mar. 2014 )
=Purchase of PPE+Sale of PPE+Purchase of Business
=-2236.50498339+7.99169435216+-21.584717608
+Sale of Business+Purchase of Investment+Sale of Investment
+0+-150.858803987+0.729235880399
+Net Intangibles Purchase And Sale+Cash From Discontinued Investing+Cash From Other Investing
+-2079.50830565+0+-461.898671096
=-4,942

Tata Motors Ltd's Cash Flow from Investing for the quarter that ended in Dec. 2014 is calculated as:

Tata Motors Ltd Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2014 was -1579.50830565 (Mar. 2014 ) + -1421.31979695 (Jun. 2014 ) + -1205.21172638 (Sep. 2014 ) + -696.400625978 (Dec. 2014 ) = $-4,902 Mil.

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.


Explanation

Cash flow from investing contains nine items:

1. Purchase Of Property, Plant, Equipment:
Purchase of PPE indicates the amount used to purchase property, plant, and equipment.

Tata Motors Ltd's purchase of property, plant, equipment for the three months ended in Dec. 2014 was $-770 Mil. It means Tata Motors Ltd spent $770 Mil on purchasing property, plant, equipment.

In the capital spending for property, plant and equipment (PPE), some part of spending may be from the expansion of business. The business needs more property, plant and equipment (PPE) as it grows. Another part may be from replacement of the property, plant and equipment (PPE) of existing business. For some companies, the cash spent on replacing of the property, plant and equipment (PPE) of the existing business will be close to the depreciation of property, plant and equipment (PPE) reported in the income statement.

In Warren Buffett’s definition of “Owner’s Earnings”, he deducts the estimate of the cost of replacing the property, plant and equipment (PPE) of the existing business from cash flow from operations. The cash spent on the new property, plant, and equipment is not deducted. The reason is because these are not costs of the existing business. In his 1986 letter to shareholders, Warren Buffett wrote this about owner earnings:

"These represent (a) reported earnings plus (b) depreciation, depletion, amortization, and certain other non-cash charges...less (c) the average annual amount of capitalized expenditures for plant and equipment, etc. that the business requires to fully maintain its long-term competitive position and its unit volume....Our owner-earnings equation does not yield the deceptively precise figures provided by GAAP, since (c) must be a guess - and one sometimes very difficult to make. Despite this problem, we consider the owner earnings figure, not the GAAP figure, to be the relevant item for valuation purposes...All of this points up the absurdity of the 'cash flow' numbers that are often set forth in Wall Street reports. These numbers routinely include (a) plus (b) - but do not subtract (c)."

2. Sale Of Property, Plant, Equipment:
Sale of PPE indicates the amount gained from selling property, plant, and equipment.

Tata Motors Ltd's sale of property, plant, equipment for the three months ended in Dec. 2014 was $0 Mil. It means Tata Motors Ltd gained $0 Mil from selling property, plant, and equipment.

3. Purchase Of Business:
Purchase of business indicates the amount used to purchase business.

Tata Motors Ltd's purchase of business for the three months ended in Dec. 2014 was $0 Mil. It means Tata Motors Ltd spent $0 Mil on purchasing business.

4. Sale Of Business:
Sale of business indicates the amount gained from selling business.

Tata Motors Ltd's sale of business for the three months ended in Dec. 2014 was $0 Mil. It means Tata Motors Ltd gained $0 Mil from selling business.

5. Purchase Of Investment:
Purchase of Investments represents cash outflow on the purchase of investments in securities.

Tata Motors Ltd's purchase of investment for the three months ended in Dec. 2014 was $-81 Mil. It means Tata Motors Ltd spent $81 Mil on purchasing investments.

6. Sale Of Investment:
Sale of Investments represents cash inflow on the sale of investments in securities.

Tata Motors Ltd's sale of investment for the three months ended in Dec. 2014 was $0 Mil. It means Tata Motors Ltd gained $0 Mil from selling investments.

7. Net Intangibles Purchase And Sale:
Net Intangibles purchase and sale means the net cash inflow received by a company that comes from the purchase and sale of intangibles. It equals the cash received from sale of intangibles minus the cash spent on purchasing intangibles.

Tata Motors Ltd's net Intangibles purchase and sale for the three months ended in Dec. 2014 was $-440 Mil. It means Tata Motors Ltd paid $440 Mil for net Intangibles purchase and sale.

8. Cash From Discontinued Investing Activities:
Cash from discontinued investing activities means the cash received by a company that comes from the discontinued investing activities.

Tata Motors Ltd's cash from discontinued investing activities for the three months ended in Dec. 2014 was $0 Mil. It means Tata Motors Ltd paid $0 Mil for discontinued investing activities.

9. Cash From Other Investing Activities:
Cash from other investing activities means the cash received by a company that comes from other investing activities.

Tata Motors Ltd's cash from other investing activities for the three months ended in Dec. 2014 was $595 Mil. It means Tata Motors Ltd received $595 Mil from other investing activities.


Related Terms

Cash Flow from Operations, Cash Flow from Financing, Cash Flow for Capital Expenditures, Purchase of PPE, Sale of PPE, Purchase of Business, Sale of Business, Purchase of Investment, Sale of Investment, Net Intangibles Purchase And Sale, Cash From Discontinued Investing, Cash From Other Investing


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Tata Motors Ltd Annual Data

Mar05Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13Mar14
PurchaseOfPPE -179-242-580-1,022-929-837-762-1,273-1,650-2,237
SaleOfPPE 742412167918118
PurchaseOfBusiness 000-2-1,924-9-4900-22
SaleOfBusiness 000502729000
PurchaseOfInvestment -339-20-12-505-125-664-33-1,638-114-151
SaleOfInvestment 11547915340331726327051
NetIntangiblesPurchaseAndSale 000-257-821-977-1,086-1,422-1,738-2,080
CashFromDiscontinuedInvestingActivities 0000000000
CashFromOtherInvestingActivities -403-426-823-5172576522295-823-462
Cash Flow from Investing -799-204-1,238-2,201-3,168-1,687-1,689-3,949-4,308-4,942

Tata Motors Ltd Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
PurchaseOfPPE 0-396-1,650-385-510-561-720-487-598-770
SaleOfPPE 00110071020
PurchaseOfBusiness 000000-22000
SaleOfBusiness 0000000000
PurchaseOfInvestment 0121-114-54223-794480-503-78-81
SaleOfInvestment 0050001000
NetIntangiblesPurchaseAndSale 0-405-1,738-401-436-486-701-455-546-440
CashFromDiscontinuedInvestingActivities 0000000000
CashFromOtherInvestingActivities 081-823794823-6202415595
Cash Flow from Investing 0-599-4,308-762-676-1,812-1,580-1,421-1,205-696
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