Chinmaya IAS Academy – Current Affairs Chinmaya IAS Academy – Current Affairs
Related Articles
Higher steel prices and consolidation of Bhushan Steel results aid the company
Tata Steel Ltd.’s second quarter consolidated net profit rose to Rs. 3,116 crore, the highest in nine years, compared with a net profit of Rs. 1,018 crore in the year-earlier period on higher steel prices and consolidation of Bhushan Steel results.
The steelmaker reported a 34% growth in turnover to Rs. 43,544 crore.
Consolidated deliveries grew 15% during the quarter to 7.42 million tonnes due to its focus on the domestic market, where a government push to improve infrastructure has raised demand. Commenting on the results, T. V. Narendran, chief executive officer and managing director, said, “Tata Steel Group has delivered extremely strong results this quarter driven by robust operational performance and favourable business conditions in India. This quarter, despite a seasonally weaker period, we sold 4.32 million tonnes across Tata Steel standalone and Bhushan Steel.”
The liquidity position of the group remains robust at Rs. 26,470 crore, said a company statement, adding that gross debt during the quarter increased by Rs. 2,065 crore primarily due to adverse forex impact of Rs. 3,528 crore. Koushik Chatterjee, executive director and CFO, said, “This has been one of the best-ever quarters for Tata Steel India on the back of strong operating and market performance with the EBIDTA margin of 34% and in excess of Rs. 19,000 per tonne and a profit after tax of Rs. 3,268 crore.
Noel Vaz, analyst, IIFL Securities said: “Tata Steel clearly beating consensus estimates for Q2FY19 due to strong outperformance by the domestic steel businesses. The strong performance of the domestic steel businesses (especially Bhushan) is likely to support the company’s deleveraging efforts going forward.
Lower leverage would help reduce stress on the balance sheet and is likely to lead to potential re-rating of the stock.” Tata Steel shares on the BSE closed up 1.07% at Rs. 589.15 in Mumbai market on Tuesday.
