Tata Steel Reports Net Profit of Rs 9,768 in First Quarter FY22; Net debt on EBITDA improves to 1.59x

Tata Steel reported net profit of Rs 9,768.34 on Thursday, up 36.4% quarter on quarter in the first quarter of fiscal 22. Total income stood at Rs53,534.04cr in the quarter under review, against Rs25,662,43cr a year ago.

Consolidated EBITDA increased 13.3% quarter on quarter to Rs16,185cr with improved achievement in key entities.

The stock is currently trading at Rs 1,458, up Rs 23 or 1.6% from its previous close of Rs 1,435 on BSE. The script opened at Rs 1,414 and hit a high and low of Rs 1,476.90 and Rs 1,392.50 respectively.

Strong points:

Mr. TV Narendran, Chief Executive Officer and Chief Executive Officer, “Over the past 15 months, the global economy has recovered thanks to political support and phased immunization, which has led to improved consumer confidence. businesses and customers. However, the Indian markets were again impacted during the last quarter due to the 2nd wave of COVID-19 which impacted our steel production as well as our deliveries. Demand has started to pick up in India, although domestic steel prices continue to be sharply reduced relative to the parity prices of Chinese imports. We continue to focus on our goal of achieving and maintaining market leadership in selected segments by building strong customer relationships, a superior distribution network, branding, and developing new products and solutions in the industry. steel and new materials.

“We are also focused on value-creating growth. Our expansion of 5 MTPA TSK phase II is progressing well. It will lead to product line enrichment and cost reduction, further strengthening our competitive position. We have accelerated the investment allocation for the 6 MTPA pellet plant and the CRM complex, both are expected to be commissioned by the first half of 2022 ”, said the CEO and General Manager of the company.

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

“Our consolidated financial performance for the quarter was exceptionally strong thanks to strong underlying business performance and favorable market conditions. The company achieved the highest consolidated quarterly EBITDA on record of Rs.16,185 crore, and after-tax profit of Rs. 9,768 crore which is higher than the annual PAT for fiscal year 2021. While the Indian company has recorded an EBITDA of Rs. 13,946 crores. , our European activities also experienced an improving quarter and the impact of higher spreads should benefit positively over the next few quarters.

Despite the increase in working capital due to rising steel and raw material prices, the company generated consolidated free cash flow of over Rs.3,500 crore during this quarter and repaid the debt of 5,894 crore rupees. We are committed to continuing our deleveraging and plan to significantly reduce debt by the end of the current fiscal year. We continue to prioritize capital spending over ongoing projects and strategically critical investments.

The company’s financial indicators have further strengthened; Net debt to equity is less than 1x while net debt to EBITDA is now reduced to 1.59x. We are pleased to note that Standard & Poor’s recently upgraded its credit rating one notch to BB Stable. The group’s liquidity position remains strong at 20,695 crore rupees, including 10,264 crore rupees in cash and cash equivalents, ”he added.

Ann J. Cox