Imports weigh on Tata Steel’s Q2 net despite narrower losses in Europe

MUMBAI: Tata Steel earned less per tonne of steel sold in India in the July-September quarter compared with last year, in line with domestic peers as steel prices remained depressed during the quarter due to cheap competition . import.

While the company’s European operations continued to lose money, losses in the UK business narrowed and the Netherlands business broke even, helping the company’s overall results.

The company reported consolidated profit of $759 crore during the quarter $It lost 65.11 billion rupees in the same period last year. it is impaired $The company lost Rs 6,899 crore in the July-September quarter last year on restructuring costs at its troubled UK unit.

Consolidated revenue for the quarter was $539.05 billion rupees, a year-on-year decrease of 3%. Revenue in India was hit by a 5% year-on-year decline. $32,399 Crores.

“Macroeconomic conditions in China continue to weigh on commodity prices, including steel. In India, steel demand continues to improve, but domestic prices are under pressure due to cheap imports,” the company’s managing director TV Narendran said in a press statement express.

On the bright side, the company’s consolidated steel sales increased by about 6% during the quarter – about 7.52 million tons. Sales growth is expected to continue given the brighter outlook for domestic demand and the company’s capacity expansion.

In September, the company commissioned a new blast furnace at its Kalingagar plant in India, which it said is the largest in the country. Around the same time, the company shut down a second blast furnace at its Port Talbot plant in Wales. It was the last blast furnace in the UK, ending the production of primary steel in the country.

ALSO READ | ‘There will be more money on the table’ if Tata Steel can create more assets and jobs in UK

India’s production increases

Comprehensive earnings before interest, tax, depreciation and amortization (Ebitda) this quarter increased by more than half year-on-year to $6,142 crores.

India’s Ebitda slightly lower than previous year $6,912 Crores. Tata Steel Europe posts Ebitda loss of $1,344 crore, compared to the loss of Rs. $2,512 crore in the same period last year.

“Consolidated Ebitda margin improved by approximately 300 basis points to 12%, driven by higher volumes in India and improved profitability in the Netherlands, despite a challenging operating environment across regions,” Chief Financial Officer Koushik Chatterjee said.

India’s earnings before interest, taxes, depreciation and amortization (Ebitda) per ton fell 6% $13,524. Comprehensive Ebitda per ton increased by 36% $8,278.

Tata Steel is fully committed to capacity expansion this quarter. Chatterjee said that while the second blast furnace at Kalinga Nagar has started commissioning, the associated downstream facilities will be commissioned in the second half of this year.

Also Read | Is a turnaround imminent for Tata Steel’s European business?

The company has also placed an order for equipment for electric arc furnaces with an annual capacity of 850,000 tons for the plant it plans to build in Ludhiana. Its British subsidiary also has a contract with Italian company Tenova to supply electric arc furnaces, he said.

Tata Steel spends $The chief financial officer further said that capital expenditure for the half year was 85.83 billion rupees, mainly in India.

Tata Steel’s consolidated net debt is $Group liquidity position at end-September stood at Rs 88,817 crore $26,028 crore, cash and cash equivalents $10,575 Crores.

Also Read | India’s bureaucratic and cumbersome steel import journey