BackTata Steel Q1 highlight: PAT falls, consolidated revenues reach ₹59,490 crores
Tata Steel reports Q3 revenues of ₹59,490 crore, with EBITDA of ₹6,122 crore. Profit after tax is ₹525 crore. India's revenues at ₹34,901 crore, EBITDA at ₹7,514 crore. Tata Steel Kalinganagar expanding capacity by 5 MTPA, including construction of largest blast furnace in India.
PremiumTata Steel reported consolidated revenues of ₹59,490 crores for the quarter, with an EBITDA of ₹6,122 crores and an EBITDA margin of 10%. The Profit after Tax stood at ₹525 crores, impacted by non-cash deferred tax charge related to the buy-in transaction at British Steel Pension Scheme, successfully derisking Tata Steel UK.
During the quarter, the company invested ₹4,089 crores in capital expenditure, focusing on projects like the 5 MTPA expansion at Kalinganagar and the 0.75 MTPA EAF mill in Punjab.
India's revenues were ₹34,901 crores, and EBITDA was ₹7,514 crores, driven by an increase in domestic deliveries and improvements in key end-use segments. Crude steel production in India was around 5 million tons, up 2% YoY, primarily due to ramp-up at Neelachal Ispat Nigam Limited.
However, Europe's revenues were £2,083 million, and EBITDA loss stood at £153 million. This was impacted by the planned relining of BF6 at Tata Steel Netherlands, leading to a drop in crude steel production.
The company's financial performance showed mixed results in different regions, with a focus on strategic investments and de-risking measures.
Tata Steel Kalinganagar is expanding its capacity by 5 MTPA. The expansion will include the construction of the largest blast furnace in India, with a capacity of 5,870 cubic meters. The expansion will also include the installation of eco-friendly technologies, such as top combustion stoves, dry gas cleaning plants, evaporative cooling systems, and top gas recovery turbines.
The expanded plant will produce value-added products, such as high-tensile steel and advanced steel, to meet the needs of the lightweighting, safety, infrastructure, and energy sectors. The expansion of Tata Steel Kalinganagar is a major investment in the Indian steel industry.
The expansion will create jobs and boost economic growth in the region. The expanded plant will produce high-quality steel products that meet the needs of the global market.
The automotive sector is the largest customer for Tata Steel, accounting for 22% of domestic deliveries in 1QFY24.
The packaging sector is the second-largest customer for Tata Steel, accounting for 18% of domestic deliveries in 1QFY24.
The construction & infrastructure sector is the third-largest customer for Tata Steel, accounting for 15% of domestic deliveries in 1QFY24.
The energy sector is the fourth-largest customer for Tata Steel, accounting for 13% of domestic deliveries in 1QFY24.
The consumer durables sector is the fifth-largest customer for Tata Steel, accounting for 11% of domestic deliveries in 1QFY24.
The table also shows that exports increased by 10% YoY in Q1FY24. The increase in exports was driven by strong demand from the auto and ancillaries sector. The auto and ancillaries sector accounted for 28% of exports in 1QFY24.
Overall, Tata Steel's domestic and export sales continue to grow on the back of strong demand. The company's focus on chosen segments is helping to drive growth. Tata Steel is well-positioned to continue its growth in the coming quarters.
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