Tata Steel reported a profit after tax of ₹759 crore on a consolidated basis in the three months ended September 30 compared with a loss of ₹6,511 crore (after exceptional item) in the same period of last year on the back of improving EBITDA.
Turnover of the company came down by 3.2 per cent to ₹53,905 crore in Q2FY25 compared with ₹55,682 crore in Q2FY24 even as Tata Steel’s deliveries rose to 7.52 million tonnes (mt) from 7.07mt, indicating pressure on prices.
The company reported ₹6,224 crore of EBITDA in the second quarter compared with ₹4,315 crore in the same period of the last year. It reported a significant reduction in other expenses from ₹19,594 crore in Q2FY24 to ₹17,493 crore on a consolidated basis, which Tata Steel attributed to lower consumables, royalty, rates and taxes.
On a standalone basis, which reflects Tata Steel’s India operations, PAT stood at ₹3,591 crore compared with ₹8,491 crore of loss in Q2FY24.
Revenue from operations declined from ₹34,198 crore to ₹32,399 crore in Q2FY25. Deliveries stood at 5.11mt compared with 4.82mt in Q2FY24.
In September, the company commissioned a 5mt blast furnace at Kalinganagar complex in Odisha. Once fully ramped up, the India crude steel capacity will rise to 26.6mt.
In the UK, Tata Steel reported a revenue of £600 million and an EBITDA loss of £147 million as it closed the remaining blast furnace for an environmentally friendly electric arc furnace and signed a grant funding agreement with the UK government.
In the Netherlands, the revenue stood at £1,300 million and EBITDA of £22 million.
The company has spent ₹4,806 crore on capital expenditure during the quarter and ₹8,583 crore for the half year.
Tata Steel’s net debt at the end of the second quarter stood at ₹88,817 crore, while gross debt rose to ₹99,392 crore from ₹92,961 crore at the end of June 30.
T.V. Narendran, managing director and CEO of Tata Steel, referred to macro economic conditions in China weighing on commodity prices, including steel.
“In India, steel demand continued to improve but domestic prices were under pressure due to cheap imports. Despite this, Tata Steel has delivered broadly consistent performance, with India deliveries at 5.1 million tonnes for the quarter and 10.1 million tonnes for the half year,” Narendran said.
Chief financial officer and whole time director Koushik Chatterjee referred to the improving EBITDA margin. “Consolidated EBITDA margin witnessed an improvement of around 300 bps to 12 per cent, aided by higher volumes in India and improved profitability in the Netherlands. This was despite a challenging operating environment across geographies,” Chatterjee pointed out.
He also informed that Tata Steel has placed equipment orders for the proposed 0.85mt EAF plant in Ludhiana.
