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Tata Motors Ltd (NYSE:TTM)
Cash Flow from Investing
$-6,018 Mil (TTM As of Sep. 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 Sep. 2014, Tata Motors Ltd spent $598 Mil on purchasing property, plant, equipment. It gained $2 Mil from selling property, plant, and equipment. It spent $0 Mil on purchasing business. It gained $0 Mil from selling business. It spent $78 Mil on purchasing investments. It gained $0 Mil from selling investments. It paid $546 Mil for net Intangibles purchase and sale. It paid $0 Mil for discontinued investing activities. And it received $15 Mil from other investing activities. In all, Tata Motors Ltd spent $1,205 Mil on investment activities in financial market and operating subsidiaries for the three months ended in Sep. 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 Sep. 2014 is calculated as:

Tata Motors Ltd Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2014 was -1811.78396072 (Dec. 2013 ) + -1579.50830565 (Mar. 2014 ) + -1421.31979695 (Jun. 2014 ) + -1205.21172638 (Sep. 2014 ) = $-6,018 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 Sep. 2014 was $-598 Mil. It means Tata Motors Ltd spent $598 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 Sep. 2014 was $2 Mil. It means Tata Motors Ltd gained $2 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 Sep. 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 Sep. 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 Sep. 2014 was $-78 Mil. It means Tata Motors Ltd spent $78 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 Sep. 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 Sep. 2014 was $-546 Mil. It means Tata Motors Ltd paid $546 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 Sep. 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 Sep. 2014 was $15 Mil. It means Tata Motors Ltd received $15 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 -179-242-580-1,022-929-837-762-1,273-1,673-2,237
SaleOfPPE 742412167918128
PurchaseOfBusiness 000-2-1,924-39-300-22
SaleOfBusiness 00050020000
PurchaseOfInvestment -339-20-12-505-428-220-72-17-114-151
SaleOfInvestment 115479153408212253151
NetIntangiblesPurchaseAndSale 000-257-821-977-1,086-1,422-1,738-2,080
CashFromDiscontinuedInvestingActivities 0000000000
CashFromOtherInvestingActivities -403-426-823-51798152223-1,256-838-462
Cash Flow from Investing -799-204-1,238-2,201-3,168-1,687-1,689-3,949-4,345-4,942

Tata Motors Ltd Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
PurchaseOfPPE 00-396-775-385-510-561-720-487-598
SaleOfPPE 00012007102
PurchaseOfBusiness 0000000-2200
SaleOfBusiness 0000000000
PurchaseOfInvestment 00121340-54223-794480-503-78
SaleOfInvestment 0005000100
NetIntangiblesPurchaseAndSale 00-405-649-401-436-486-701-455-546
CashFromDiscontinuedInvestingActivities 0000000000
CashFromOtherInvestingActivities 0081-963794823-6202415
Cash Flow from Investing 00-599-2,030-762-676-1,812-1,580-1,421-1,205
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