Tata Steel reports Consolidated Revenues of Rs 2,43,353 crores for FY2023

By Kalinga Voice Last updated May 3, 2023

~Company spent Rs 4,396 cr on capital expenditure in the quarter and Rs 14,142 crores for the full year~
~ The Board of Directors recommends dividend of Rs 3.60 per share ~

Mumbai, May 2, 2023: Tata Steel today announced its Financial Results for the quarter and year ended March 31, 2023. The Company’s Consolidated Revenues for FY2023 stood at Rs 2,43,353 crores and were broadly similar on YoY basis despite the volatile operating environment across geographies. Consolidated Profit after Tax stood at Rs 8,075 crores.

During the quarter ended March 2023, the Company’s Consolidated Revenues stood at Rs 62,962 crores and EBITDA was at Rs 7,225 crores, with an EBITDA margin of ~11%. The Company’s profitability improved primarily on India performance.

During FY2023, the Company’s India crude steel production grew to around 19.9 million tons, with a 65% share of Tata Steel’s overall volumes. Deliveries were in line with production with domestic deliveries growing 11% YoY and driving product mix improvement. The quarter also saw strong momentum with deliveries growing by 9% QoQ to 5.15 million tons.

The Board of Directors of Tata Steel recommended a dividend of Rs. 3.60 per fully paid-up equity share of face value of Re 1/- each.

Mr. T V Narendran, CEO&MD, Tata Steel, said, “We have multiple projects ongoing at various locations in India as we work towards 40 MTPA by 2030. The phased commissioning of our expansion at Kalinganagar continues with FHCR coils now being produced at the CRM complex.”

Neelachal Ispat Nigam Limited has steadily ramped up during the last two quarters and is presently operating with a run rate of ~1 million tons (crude steel plus pig iron) on annualised basis.

“Within 9 months of acquisition, we have successfully ramped up Neelachal Ispat Nigam Limited to ~1 million tons on annualised basis. We have also progressed on our plans to set up our first EAF mill in Punjab. During the quarter, Europe deliveries were up 9% QoQ. The Cold Mill upgrade at Ijmuiden is progressing and we have commenced the relining of BF6 in early April,” Mr Narendran said.

Sustainability is at the core of Tata Steel’s strategy and the Company has committed to Net Zero by 2045. The Company’s route and pace of decarbonisation across geographies will be calibrated for each location based on the local regulatory framework, government support, and willingness of customers to pay for higher-cost green steel.

“We continue to pursue multiple initiatives to reduce our emissions including a recently initiated trial for injecting large quantity of hydrogen into one of our blast furnaces at Jamshedpur, a global first. I am also happy to share that Tata Steel has been recognised by worldsteel as Sustainability champion for the sixth time in a row and by World Economic Forum as Global Diversity, Equity & Inclusion Lighthouse,” Mr Narendran added.

Europe revenues were £9,293 million and EBITDA was £477 million, translating to an EBITDA per ton of £58.

Mr. Koushik Chatterjee, Executive Director and Chief Financial Officer, said: “Our Consolidated revenues for the financial year were ~$30 billion. Revenues were broadly stable on YoY basis despite the heightened volatility in the operating environment. Consolidated EBITDA stood at Rs 32,698 crores, which translates to an EBITDA margin of 13% and EBITDA per ton of Rs 11,358. The India business generated a margin of 20% while Europe was at 5% with higher input costs affecting margins. The consolidated ROIC was 15% for the full year.

“During the quarter, our consolidated revenues stood at Rs 62,962 crores while EBITDA was Rs 7,225 crores. India business witnessed a margin improvement from 15% to 22% driven by improved realisations QoQ. In Europe, margins were broadly similar on QoQ basis as improvement in costs was offset by drop in revenues, in part due to delay in ramp up of cold mill at Ijmuiden. Cash flow from operations before interest stood at Rs 11,260 crores driven by favourable working capital movement,” Mr Chatterjee said.

“Our capital expenditure was Rs 4,396 crores for the quarter as we prioritise completion of the 5 MTPA Kalinganagar expansion and free cash flow was Rs 4,809 crores. We reduced our leverage by ~Rs 3,900 crores this quarter and our Net debt stands at Rs 67,810 crores. We were successful in maintaining our interest cost despite the 250bps increase in benchmark interest rates. Our financial metrices continue to be within our medium-term targets, with Net debt to EBITDA at 2.07x and Net debt to equity at 0.61x. We remain focused on cost optimisation, operational improvements and working capital management to maximise cashflows and will aim to resume our deleveraging journey in FY2024. The Board has recommended dividend of Rs 3.60 per share,” Mr Chatterjee added.