Tata Steel

5 Feb 2022 , 02:02 PM

Tata Steel consolidated net sales increased 44.95% to Rs 60783.11 crore in Q3FY22 compared to Q3FY21.? Sales of Tata Steel India segment has gone up 37.83% to Rs 31,964.25 crore (accounting for 39.29% of total sales).? Sales of Tata Steel Long Products segment has gone up 22.95% to Rs 1,677.22 crore (accounting for 2.06% of total sales).? Sales of Other Indian Operations segment has gone up 91.99% to Rs 5,796.93 crore (accounting for 7.12% of total sales).? Sales of Tata Steel Europe segment has gone up 61.83% to Rs 22,768.76 crore (accounting for 27.98% of total sales).? Sales of Other Trade Related Operations segment has gone up 117.41% to Rs 16,847.63 crore (accounting for 20.71% of total sales).? Sales of segment has gone down 75.87% to Rs 108.68 crore (accounting for 0.13% of total sales).? Sales of segment has gone down 11.20% to Rs 2,200.65 crore (accounting for 2.70% of total sales).? Inter-segment sales rose Rs 10,995.57 crore to Rs 20,581.01 crore.?

Operating profit margin has jumped from 22.82% to 26.15%, leading to 66.11% rise in operating profit to Rs 15,893.67 crore.? Raw material cost as a % of total sales (net of stock adjustments) increased from 28.62% to 31.74%.?? Purchase of finished goods cost fell from 6.74% to 5.47%.?? Employee cost decreased from 12.77% to 8.78%.?? Other expenses fell from 29.50% to 29.47%.??

Other income fell 72.61% to Rs 59.61 crore.? PBIDT rose 63.02% to Rs 15953.28 crore.? Profit before interest, tax and other unallocable items (PBIT) have jumped 60.08% to Rs 15,689.91 crore.? PBIT of Tata Steel India segment rose 45.94% to Rs 12,167.10 crore (accounting for 77.55% of total PBIT).? PBIT of Tata Steel Long Products segment fell 42.01% to Rs 254.99 crore (accounting for 1.63% of total PBIT).? PBIT of Other Indian Operations segment rose 27.34% to Rs 429.48 crore (accounting for 2.74% of total PBIT).? PBIT of Tata Steel Europe reported profit of Rs 2,942.30 crore compared to loss of Rs 724.27 crore.? PBIT of Other Trade Related Operations reported loss of Rs 9.81 crore compared to profit of Rs 1,409.08 crore.? PBIT of segment fell 189.15% to Rs -324.57 crore (accounting for -2.07% of total PBIT).? PBIT of segment rose 101.40% to Rs 230.42 crore (accounting for 1.47% of total PBIT).?

PBIT margin of Tata Steel India segment rose from 35.95% to 38.06%.? PBIT margin of Tata Steel Long Products segment fell from 32.23% to 15.20%.? PBIT margin of Other Indian Operations segment fell from 11.17% to 7.41%.? PBIT margin of Tata Steel Europe segment rose from negative 5.15% to 12.92%.? PBIT margin of Other Trade Related Operations segment fell from 18.18% to 0.06%.? PBIT margin of segment fell from negative 24.92% to negative 298.65%.? PBIT margin of segment rose from 4.62% to 10.47%.? Overall PBIT margin rose from 18.73% to 19.28%.?

Provision for interest fell 14.19% to Rs 1532.49 crore.? PBDT rose 80.26% to Rs 14420.79 crore.? Provision for depreciation fell 4.16% to Rs 2244.09 crore.? Profit before tax grew 115.20% to Rs 12,176.70 crore.? Share of profit/loss was 106.25% higher at Rs 182.28 crore.? Extraordinary items were decreased to Rs -193.40 crore.? Provision for tax was expense of Rs 2567.42 crore, compared to Rs 1582.25 crore.? Effective tax rate was 21.10% compared to 28.29%.

Minority interest decreased 91.87% to Rs 25.49 crore.? Net profit attributable to owners of the company increased 158.92% to Rs 9,572.67 crore.

Promoters stake was 33.92% as of 31 December 2021 ,compared to 34.41% as of 31 December 2020. Promoters pledged stake was 1.55% as of 31 December 2021 compared to 3.37% as of 31 December 2020.?

For year-to-date (YTD) results analysis

Net sales of Tata Steel has increased 64.06% to Rs 174635.67 crore.? Sales of Tata Steel India segment has gone up 62.64% to Rs 92,340.42 crore (accounting for 40.36% of total sales).? Sales of Tata Steel Long Products segment has gone up 56.17% to Rs 5,002.23 crore (accounting for 2.19% of total sales).? Sales of Other Indian Operations segment has gone up 124.84% to Rs 15,082.49 crore (accounting for 6.59% of total sales).? Sales of Tata Steel Europe segment has gone up 64.04% to Rs 63,634.23 crore (accounting for 27.81% of total sales).? Sales of Other Trade Related Operations segment has gone up 117.16% to Rs 42,935.40 crore (accounting for 18.76% of total sales).? Sales of segment has gone up 9.64% to Rs 759.26 crore (accounting for 0.33% of total sales).? Sales of segment has gone up 44.79% to Rs 9,061.88 crore (accounting for 3.96% of total sales).? Inter-segment sales rose Rs 25,754.99 crore to Rs 54,180.24 crore.?

Operating profit margin has jumped from 15.33% to 27.75%, leading to 196.94% rise in operating profit to Rs 48,460.34 crore.? Raw material cost as a % of total sales (net of stock adjustments) decreased from 31.33% to 29.38%.?? Purchase of finished goods cost rose from 5.88% to 6.41%.?? Employee cost decreased from 14.06% to 9.30%.?? Other expenses fell from 32.93% to 28.71%.??

Other income fell 20.97% to Rs 492.69 crore.? PBIDT rose 188.92% to Rs 48953.03 crore.? Profit before interest, tax and other unallocable items (PBIT) has jumped 203.30% to Rs 51,644.80 crore.? PBIT of Tata Steel India segment rose 150.31% to Rs 39,093.71 crore (accounting for 75.70% of total PBIT).? PBIT of Tata Steel Long Products segment rose 71.53% to Rs 1,111.74 crore (accounting for 2.15% of total PBIT).? PBIT of Other Indian Operations segment rose 118.96% to Rs 1,516.43 crore (accounting for 2.94% of total PBIT).? PBIT of Tata Steel Europe reported profit of Rs 7,815.08 crore compared to loss of Rs 1,812.23 crore.? PBIT of Other Trade Related Operations segment fell 33.12% to Rs 1,303.02 crore (accounting for 2.52% of total PBIT).? PBIT of segment rose 18.68% to Rs -260.78 crore (accounting for -0.50% of total PBIT).? PBIT of segment rose 320.02% to Rs 1,065.60 crore (accounting for 2.06% of total PBIT).?

PBIT margin of Tata Steel India segment rose from 27.51% to 42.34%.? PBIT margin of Tata Steel Long Products segment rose from 20.23% to 22.22%.? PBIT margin of Other Indian Operations segment fell from 10.32% to 10.05%.? PBIT margin of Tata Steel Europe segment rose from negative 4.67% to 12.28%.? PBIT margin of Other Trade Related Operations segment fell from 9.85% to 3.03%.? PBIT margin of segment rose from negative 46.31% to negative 34.35%.? PBIT margin of segment rose from 4.05% to 11.76%.? Overall PBIT margin rose from 12.88% to 22.57%.?

Provision for interest fell 23.98% to Rs 4363.69 crore.? PBDT rose 298.01% to Rs 44589.34 crore.? Provision for depreciation rose 0.24% to Rs 6857.48 crore.? Profit before tax grew 765.03% to Rs 37,731.86 crore.? Share of profit/loss was 176.84% higher at Rs 489.81 crore.? Provision for tax was expense of Rs 6447.7 crore compared to Rs 3458.95 crore. Effective tax rate was 16.81% compared to 77.09%.

Minority interest increased 734.10% to Rs 1,516.47 crore. Net profit attributable to owners of the company increased 3,492.82% to Rs 30,397.73 crore.?

Promoters stake was 33.92% as of 31 December 2021 compared to 34.41% as of 31 December 2020. Promoters pledged stake was 1.55% as of 31 December 2021 compared to 3.37% as of 31 December 2020.?

Management Comments:

Mr. T V Narendran, Chief Executive Officer & Managing Director:

?India steel demand has begun to improve on the back of continued economic recovery as 3rd wave of COVID begins to ebb. Our steel deliveries in India expanded by 4% in the first nine months of the financial year along with an improvement in product mix. We continue to drive value accretive growth in our chosen segments and our performance in key segments such as auto was robust despite the sector being impacted by the semiconductor shortage. Our European operations continue to perform underpinned by strong improvement in realizations.

We continue to progress on our stated goals. We became the first company in the world to conduct trials to inject Coal Bed Methane gas into a Blast Furnace in a bid to reduce emissions. Our 5 MTPA TSK phase II expansion including the pellet plant and CRM complex is progressing well. Tata Steel Long Products has been declared the winning bidder for Neelachal Ispat Nigam Limited. This will enable us to significantly ramp up our Long products portfolio and benefit from the growth in infrastructure in India and retail housing growth in semi urban India. We will leverage our retail brands and pan India distribution network to drive scale, profitability and cashflows.?

Mr. Koushik Chatterjee, Executive Director and Chief Financial Officer:

?Tata Steel continued to deliver strong operating and financial performance in 3QFY22 with year on year EBIDTA growth of 64% and Profit after Tax growth of 139%. The company posted strong operating cash flows in the quarter despite a significant surge in international coal prices and increased working capital requirements. Despite market volatility, the revenues were broadly stable at Rs 60,783 crores while EBIDTA was Rs 15,853 crores which works out to a margin of 26% with Tata Steel Standalone EBIDTA margin at 38%. Our cash outflow on consolidated capex for the quarter was Rs 2,790 crores taking the nine months capex to Rs 6,416 crores which is well within the earlier guidance. Tata Steel generated strong free cash flows of Rs 6,338 crores for the quarter which were used to reduce the debt. Tata Steel Long Products has been declared the winning bidder for acquisition of Neelachal Ispat Nigam Limited and we are progressing on the formalities. The acquisition will be financed by Tata Steel largely through a combination of internal accruals and bridge funding.

Tata Steel continues to remain focused on its enterprise strategy to deleverage its Balance Sheet while it pursues its growth priorities. During the first nine months we have repaid Rs 17,376 crores of debt and our net debt as at end December stands at Rs 62,869 crores. As a result of the strong financial performance, our Net Debt / EBIDTA has come down further to <1x and the financial metrics of the company continue to be at investment grade level.?

.Full year results analysis.

Net sales (including other operating income) of Tata Steel has increased 4.92% to Rs 156294.18 crore.? Sales of Tata Steel India segment has gone up 7.34% to Rs 64,869.00 crore (accounting for 32.95% of total sales).? Sales of Bamnipal Steel (including Tata Steel BSL segment has gone up 17.69% to Rs 21,418.63 crore (accounting for 10.88% of total sales).? Sales of Tata Steel Long Products segment has gone up 36.10% to Rs 4,749.87 crore (accounting for 2.41% of total sales).? Sales of Other Indian Operations segment has gone up 8.55% to Rs 10,307.72 crore (accounting for 5.24% of total sales).? Sales of Tata Steel Europe segment has gone up 0.20% to Rs 56,050.93 crore (accounting for 28.47% of total sales).? Sales of Other Trade Related Operations segment has gone down 7.51% to Rs 29,344.16 crore (accounting for 14.91% of total sales).? Sales of segment has gone up 93.48% to Rs 802.09 crore (accounting for 0.41% of total sales).? Sales of segment has gone down 4.76% to Rs 9,311.07 crore (accounting for 4.73% of total sales).? Inter-segment sales rose Rs 40,507.24 crore to Rs 40,559.29 crore.?

Operating profit margin has jumped from 11.97% to 19.52%, leading to 71.11% rise in operating profit to Rs 30,504.26 crore.? Raw material cost as a % of total sales (net of stock adjustments) decreased from 35.86% to 29.84%.?? Purchase of finished goods cost fell from 7.03% to 5.97%.?? Employee cost increased from 12.81% to 12.86%.?? Other expenses fell from 32.37% to 31.62%.?

Other income fell 50.84% to Rs 895.6 crore.? PBIDT rose 59.80% to Rs 31399.86 crore.? Profit before interest, tax and other unallocable items (PBIT) has jumped 60.28% to Rs 32,127.83 crore.? PBIT of Tata Steel India segment rose 45.41% to Rs 21,951.63 crore (accounting for 68.33% of total PBIT).? PBIT of Bamnipal Steel (including Tata Steel BSL segment rose 131.24% to Rs 5,480.69 crore (accounting for 17.06% of total PBIT).? PBIT of Tata Steel Long Products segment rose 528.09% to Rs 1,154.25 crore (accounting for 3.59% of total PBIT).? PBIT of Other Indian Operations segment rose 17.30% to Rs 1,032.15 crore (accounting for 3.21% of total PBIT).? PBIT of Tata Steel Europe segment fell 6.90% to Rs -618.39 crore (accounting for -1.92% of total PBIT).? PBIT of Other Trade Related Operations segment rose 70.97% to Rs 3,076.93 crore (accounting for 9.58% of total PBIT).? PBIT of reported loss of Rs 498.30 crore compared to profit of Rs 13.01 crore.? PBIT of segment rose 49.87% to Rs 548.87 crore (accounting for 1.71% of total PBIT).?

PBIT margin of Tata Steel India segment rose from 24.98% to 33.84%.? PBIT margin of Bamnipal Steel (including Tata Steel BSL segment rose from 13.02% to 25.59%.? PBIT margin of Tata Steel Long Products segment rose from 5.27% to 24.30%.? PBIT margin of Other Indian Operations segment rose from 9.27% to 10.01%.? PBIT margin of Tata Steel Europe segment rose from negative 1.19% to negative 1.10%.? PBIT margin of Other Trade Related Operations segment rose from 5.67% to 10.49%.? PBIT margin of segment fell from 3.14% to 62.13%.? PBIT margin of segment rose from 3.75% to 5.89%.? Overall PBIT margin rose from 10.58% to 16.32%.?

Provision for interest rose 0.34% to Rs 7606.71 crore.? Loan funds declined from Rs 1,13,289.45 crore as of 31 March 2020 to Rs 81,900.90 crore as of 31 March 2021.? Inventories rose to Rs 33,276.38 crore as of 31 March 2021 from Rs 31,068.72 crore as of 31 March 2020.? Sundry debtors were higher at Rs 9,539.84 crore as of 31 March 2021 compared to Rs 7,884.91 crore as of 31 March 2020.? Cash and bank balance declined from Rs 8,054.72 crore as of 31 March 2020 to Rs 5,782.18 crore as of 31 March 2021.? Investments rose to Rs 10,681.93 crore as of 31 March 2021 from Rs 6,285.18 crore as of 31 March 2020 .?

PBDT rose 97.15% to Rs 23793.15 crore.? Provision for depreciation rose 6.04% to Rs 9233.64 crore.? Fixed assets declined from Rs 1,49,992.96 crore as of 31 March 2020 to Rs 1,46,583.19 crore as of 31 March 2021.? Intangible assets increased from Rs 4,054.53 crore to Rs 8,199.39 crore.?

Profit before tax grew 333.17% to Rs 14,559.51 crore.? Share of profit/loss was 74.14% higher at Rs 327.34 crore.? Extraordinary items were increased to Rs -1,043.16 crore.? Provision for tax was debit of Rs 5653.9 crore, compared to credit of Rs 2552.9 crore.? Effective tax rate was 40.84% compared to 184.93%.

Net profit attributable to owners of the company increased 381.21% to Rs 7,490.22 crore.?

Equity capital increased from Rs 1,144.95 crore as of 31 March 2020 to Rs 1,197.61 crore as of 31 March 2021.? Per share face Value remained same at Rs 10.00.?

Promoters stake was 34.41% as of 31 March 2021 compared to 34.41% as of 31 March 2020.? Promoters pledged stake was 1.55% as of 31 March 2021 compared to 3.37% as of 31 March 2020.?

Cash flow from operating activities increased to Rs 44,326.68 crore for year ended March 2021 from Rs 20,168.72 crore for year ended March 2020.? Cash flow used in acquiring fixed assets during the year ended March 2021 stood at Rs 6,978.59 crore, compared to Rs 10,398.00 crore during the year ended March 2020.?

The scrip is currently trading at Rs 1176?

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Tata Steel : Consolidated Results
Particulars	2112 (03)	2012 (03)	Var.(%)	2112 (09)	2012 (09)	Var.(%)	2103 (12)	2003 (12)	Var.(%)
Net Sales	60,783.11	41,935.21	45	174635.67	106449.03	64	156477.40	148971.71	5
OPM (%)	26.2	22.8	?	27.8	15.3	?	19.5	12.0	?
OP	15,893.67	9,568.24	66	48,460.34	16,320.18	197	30,504.26	17,827.57	71
Other Inc.	59.61	217.66	-73	492.69	623.42	-21	895.6	1,821.99	-51
PBIDT	15,953.28	9,785.90	63	48,953.03	16,943.60	189	31,399.86	19,649.56	60
Interest	1,532.49	1,786.01	-14	4,363.69	5,740.44	-24	7,606.71	7,580.72	0
PBDT	14,420.79	7,999.89	80	44,589.34	11,203.16	298	23,793.15	12,068.84	97
Depreciation	2244.09	2341.53	-4	6857.48	6841.23	0	9233.64	8707.67	6
PBT	12,176.70	5,658.36	115	37731.86	4361.93	765	14559.51	3361.17	333
Share of Profit/(Loss) from Associates	182.28	88.38	106	489.81	176.93	177	327.34	187.97	74
PBT before EO	12358.98	5746.74	115	38221.67	4538.86	742	14886.85	3549.14	319
EO Income	-193.4	-153.55	-26	140.23	-52.03	LP	-1043.16	-4929.58	79
PBT after EO	12165.58	5593.19	118	38361.9	4486.83	755	13843.69	-1380.44	LP
Taxation	2567.42	1582.25	62	6447.7	3458.95	86	5653.9	-2552.9	PL
PAT	9598.16	4010.94	139	31914.2	1027.88	999	8189.79	1172.46	599
Minority Interest (MI)	25.49	313.72	-92	1516.47	181.81	734	699.57	-384.08	PL
Net profit	9572.67	3697.22	159	30397.73	846.07	999	7490.22	1556.54	381
EPS (Rs)*	79.63	31.1	?	248	6.99	?	65.86	39.8	?
Notes
* EPS is on current equity of Rs 1,221.24 crore, Face value of Rs 10, Excluding extraordinary items.
# EPS is not annualised
bps : Basis points
EO : Extraordinary items
Figures in Rs crore
Source: Capitaline Corporate Database

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Tata Steel : Consolidated Segment Results
?	% of (Total)	2112 (03)	2012 (03)	Var.(%)	% of (Total)	2112 (09)	2012 (09)	Var.(%)	% of (Total)	2103 (12)	2003 (12)	Var.(%)
Sales	?	?	?	?
Tata Steel India	39	31,964.25	23,190.31	38	40	92,340.42	56,777.49	63	43	84,321.92	60,435.97	40
Tata Steel Long Products	2	1,677.22	1,364.17	23	2	5,002.23	3,203.13	56	2	4,749.87	3,489.99	36
Other Indian Operations	7	5,796.93	3,019.46	92	7	15,082.49	6,708.19	125	5	10,640.56	9,495.75	12
Tata Steel Europe	28	22,768.76	14,069.92	62	28	63,634.23	38,792.98	64	29	56,050.93	55,938.99	0
Other Trade Related Operations	21	16,847.63	7,749.15	117	19	42,935.40	19,771.21	117	15	29,344.16	31,728.09	-8
Rest of World	0	108.68	450.36	-76	0	759.26	692.5	10	0	802.09	414.55	93
South East India Operations	3	2,200.65	2,478.22	-11	4	9,061.88	6,258.52	45	5	9,311.07	9,776.47	-5
Total Reported Sales	100	81,364.12	52,321.59	56	100	228815.9	132204	73	100	195220.6	189479	3
Less: Inter segment revenues	?	20,581.01	10,995.57	87	?	54,180.24	25,754.99	110	?	38,554.20	40,507.24	-5
Net Sales	?	60,783.11	41,326.02	47	?	174636	106449	64	?	156666.4	148971.7	5
PBIT	?	?	?	?
Tata Steel India	78	12,167.10	8,337.02	46	76	39,093.71	15,617.85	150	85	27,339.69	15,095.93	81
Bamnipal Steel (including Tata Steel BSL	0	0	0	–	?	?	?	?	?	?	?	?
Tata Steel Long Products	2	254.99	439.73	-42	2	1,111.74	648.14	72	4	1,154.25	183.77	528
Other Indian Operations	3	429.48	337.27	27	3	1,516.43	692.57	119	4	1,150.20	879.95	31
Tata Steel Europe	19	2,942.30	-724.27	LP	15	7,815.08	-1,812.23	LP	-2	-618.39	-664.19	7
Other Trade Related Operations	0	-9.81	1,409.08	PL	3	1,303.02	1,948.44	-33	10	3,076.93	1,799.71	71
Rest of World	-2	-324.57	-112.25	-189	-1	-260.78	-320.69	19	-2	-499.51	13.01	PL
South East India Operations	1	230.42	114.41	101	2	1,065.60	253.7	320	2	548.87	366.22	50
Total PBIT	100	15,689.91	9,800.99	60	100	51,644.80	17,027.78	203	100	32,152.04	20,044.52	60
Less : Interest	?	1,532.49	1,786.01	-14	?	4,363.69	5,740.44	-24	?	7,606.71	7,580.72	0
Add: Other un-allcoable	?	-1,991.84	-2,421.79	18	?	-8,919.21	-6,800.51	-31	?	-10,701.6	-13,844.2	23
PBT	?	12,165.58	5,593.19	118	?	38,361.90	4,486.83	755	?	13,843.69	-1,380.44	LP

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