S&P Global Ratings has changed the outlook on Tata Motors Passenger Vehicles (NSE:TATAMOTORS, BOM:500570) and TML Holdings to negative while affirming the BBB long-term issuer credit rating, according to a recent release.

Tata Motors Passenger Vehicles' cash flow could notably dip amid lingering operational disruption at subsidiary Jaguar Land Rover Automotive, which is responsible for 80% of the parent's earnings, S&P said.

The outlook considers Fitch's expectation that JLR's recovery could be extended after the disruption caused by a cyber incident, therefore impacting its parent's credit metrics.

The subsidiary's revenue could fall 15% to 18% to about 24 billion pounds in fiscal 2026, while profitability could also weaken amid continued aggressive investments, the rating agency said.

Due to the cyberattack's impact, S&P now sees the parent's adjusted net debt to EBITDA ratio to approach between 2.5x and 3x in fiscals 2026 and 2027.

Developments in the cyber incident's impact on the subsidiary's earnings or the parent's credit metrics amid a recovery in sales volume and operating cash flows could trigger future rating actions.