Q1 FY24 reveals steady performance for Tata Steel despite economic headwinds

Tata Steel disclosed a Consolidated EBITDA of Rs 6,122 crores for the quarter ending June 30, 2023 (1QFY24). Despite global economic turbulence, the steel manufacturing giant reported Consolidated Revenues standing at Rs 59,490 crores with a 10% EBITDA margin.

The company also reported a Consolidated Profit after Tax of Rs 525 crores. The profitability was affected by a non-cash deferred tax charge due to a buy-in transaction at the British Steel Pension Scheme (BSPS). This move completes the insurance buy-in of BSPS, successfully derisking Tata Steel UK.

Tata Steel invested Rs 4,089 crores in capital expenditure during the quarter, progressing the work on a 5 MTPA expansion at Kalinganagar and a 0.75 MTPA EAF mill in Punjab. The company’s net debt stands at Rs 71,397 crores, with a strong group liquidity of Rs 30,569 crores.

Tata Steel’s CEO and MD, T V Narendran, commented on the company’s performance: “During the quarter, global economic recovery continued to face headwinds affecting commodity prices including steel. In India, domestic steel demand continued to grow and was up around 10% on YoY basis but steel spot prices moderated in line with global cues.

“Tata Steel delivered steady performance, with India crude steel production of around 5 million tons. Domestic deliveries were up >20% and grew at a faster pace than India’s apparent steel consumption. We saw strong growth in key segments such as Branded Products & Retail and Industrial Products & Projects, which grew by 37% and 24% respectively, on YoY basis. Our retail sales majorly to individual home builders crossed 3 million tons in the last 12 months and we now service 8,000+ out of ~19,100 pin codes in India.”