New Delhi : Tata Steel reported a 13% decline in quarterly profit but managed to comfortably top analysts’ estimates on better-than-expected price realizations in India and better profitability in Europe.
net profit increased 7,714 crore in the three months ended June 30 8,900 crore a year ago, the Mumbai-based steel maker said. Compared to 7,380 crore consensus estimates in Bloomberg survey. Sales up 19% 63,430 crore, and the cost increased by 25% 51,910 crores.
Standalone net profit down 31% from a year ago 6,114.17 crore but beat analysts’ estimates 4,880 crores.
Its European operations saw a sharp increase in profitability, although sales volume fell.
Kamlesh Bagmar, deputy head of research at Prabhudas Lilladher, said Tata Steel’s performance was fueled by higher than expected realizations in India and higher margins in Tata Steel Europe.
However, levying of export duty on steel, rising raw material cost and fall in steel prices globally affected the company’s performance.
“It has been a challenging quarter for the global and Indian economy, owing to rising interest rates, supply chain constraints and a slowdown in China due to Covid. TV Narendran, Chief Executive and Managing Director, Tata Steel said, “Despite these many hurdles, Tata Steel has delivered strong performance with improved margins.
High raw material prices reduced the profitability of its domestic operations. As a result, the company’s standalone operating profit for operations in India fell 31%. 9,582 crore from a year ago and 23.6% from the preceding March quarter.
For its operations in India, Ebitda per tonne fell to 23,557 24,469 more in the last three months 33,568 in the year-ago quarter.
In rupee terms, Ebitda per tonne was much better than the 28,220 seen in European operations 18,135 in the previous quarter and 6,590 in the year-ago quarter.
consolidated EBITDA 15,047 crore was not much less than Rs. 15,174 crore in the last three months, though below 16,185 crore in the year-ago quarter.
revenue per ton increased 8,534 sequentially 83,625 per tonne on account of longer-term contracts and better product mix, the company said.
The company said its expansion projects are progressing well, with its six million tonne per annum (MTPA) pellet plant at Kalinganagar scheduled to be commissioned in the third quarter, followed by the cold roll mill complex.
“we spent 2,725 crore on capital expenditure, in line with our annual capital expenditure guidance as we progress on our Kalinganagar expansion. Volatility in commodity prices and the immediate impact of export duties in India have driven working capital growth, but should normalize as a result of our cost recovery and other initiatives as well as expected pick-up in demand in the second half of the year. of working capital,” said Kaushik Chatterjee, executive director and chief financial officer.
Despite significant working capital pressures, net debt remained at 54,504 crore and the company’s financial indicators remain strong, Chatterjee said.
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