Tata Steel in the limelight

about 10 months ago
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Tata Steel PP (Partially Paid) is the top gainer on the BSE since the opening bell. The stock price hit the 10% UC at Rs.148.35, with an almost 1.5 times jump in volumes.

Obviously, this is the effect of the spectacular Q2FY19 numbers announced by Tata Steel.

Beating all expectations, Tata Steel posted a consolidated net profit of Rs.3116 crore, a three-fold jump from previous Q2’s Rs.1018 crore. This performance includes the earnings of Bhushan Steel too but if we look at the standalone performance, net profit has gone up over 2.5 times to Rs.3268 crore. Thus the Indian operations as such have done very well on the back of very strong volumes and higher realisations.

Total consolidated revenue rose 34% (YoY) at Rs.43,544 crore and EBITDA rose 93% at Rs.9000 crore. EBITDA/tonne improved from Rs.7227 to Rs.12,131. In fact Tata Steel India operations reported EBITDA/tonne of Rs 19,000, which was the highest in six years. 

The company also reported an exceptional gain of Rs 164 crore v/s Rs.45 crore (YoY). Exceptional gain worth Rs 130 crore was attributed to liabilities that were not required to be written back and remaining from the sale of subsidiaries in JVs w.r.t its European operations.

Net debt of Tata Steel as at 30th Sept 2018 stands at Rs.1,04,202 crore and cash at Rs.14,478 crore. Its finance outgo for Q2 has gone up from Rs.1670 crore to Rs.2153 crore (QoQ) on account of external borrowings for acquisition of Bhushan Steel.

Tata Steel PP got listed on the bousres on March 19, at Rs 138 and it continues to show much higher gains than Tata Steel, which today rose 3.5% to Rs.610.

Tata Steel offered two types of rights issues — fully-paid up shares at Rs 510 per share and partly-paid up shares at Rs 615 per share, but investors would pay Rs 154 per share (25 per cent) upfront, with the balance due within a year. The partly-paid up shares were listed separately and will remain traded until the call is given for the balance amount. 

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