Tata Steel reports loss of Rs 49 crore in Q2

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The management said it continues to be in discussion with Thyssenkrup to explore for a strategic collaboration through a potential joint venture. Alongside, the sale process of Tata Steel UK’s specialty steels business are ongoing and shortlisted bidders have been given access to due diligence and management meetings, informed the company.

“Our stronger cost and product mix position combined with currency tailwinds to improve our quarterly EBITDA performance,” Hans Fischer, managing director and chief executive officer Tata Steel in Europe was quoted as saying.

“Our differentiation strategy continues to make progress with sales of differentiated products increasing by almost a seventh compared to a year ago. Among new product launches were an advanced high-strength steel offering carmakers weight savings in chassis components and a new product in our world-leading range called Coretinium for electromagnetically shielded rooms and lighter-weight commercial vehicle trailers,” Fischer said. 

“We are continuing to focus on improving our competitive performance in the context of the continuing global supply demand imbalance which led to steel imports into Europe increasing by a further 11% in the first half of 2016,” he added.

Going ahead, a seasonal rise in domestic demand backed by good monsoon could push up volumes. Also, increase in tariff barriers globally on China has raised export opportunities for the company and flat steel products are having more demand in the global market compared to long steel products.

“The quality and volume ramp-up at the Kalinganagar plant is progressing well and during the quarter,it crossed a major milestone of one million tons of hot metal production in less than six months,” T V Narendran, managing director of Tata Steel India and South East Asia was quoted as saying.

Steel demand in Thailand is expected to maintain its growth rate on increasing government expenditure and progress on infrastructure investment plans.

Tata Steel reports loss of Rs 49 crore in Q2

Net sales of the company remained flat at Rs 27,471 crore in the period under review indicating stagnent business scenario

Net sales of the company remained flat at Rs 27,471 crore in the period under review indicating stagnent business scenario

According to Bloomberg estimates, Tata Steel’s bottomline was seen at a profit of Rs 712 crore in the September quarter with topline expected to be at Rs 27,334 crore.

The company did manage to more than double its operating profit on year-on-year basis to Rs 1,502 crore in the quarter gone by as it focussed on reducing expenses which werelower by a meager 4%. However, a 23% rise in finance cost and significant jump in total tax expenses to Rs 363 crore ate into the operating profit.

“The operating performance of European operations has improved significantly due to improvement in operating performance, impact of restructuring of structurally weak businesses and favourable market and currency movements especially in the UK,” Koushik Chatterjee, group executive director (finance and corporate) was quoted as saying.

The company’s consolidated net debt stood at Rs 75,563 crore as on September 30, 2016.

In India, the Kalinganagar ramping up achieved a major milestone production of one million tonne. The company expects to produce and sell more than 1.3 million tonne in 2016-17 (Apr-Mar).

On South East Asian operations, he said, “our South East Asian business operations faced renewed pressure from China imports. While Thailand operations were stable on the back of an improvement in domestic demand and better management of spreads, Singapore operations were affected by contracting downstream spreads. We continue to focus on downstream products and solutions and exports to drive profitability,” he said.

Aditi Divekar