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21 October 2017

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Tata Steel Ltd (Steel - Large)

Last Price 705.50
Net Changes -4.10
Volume 410438
Prev Close 709.60
705.50 -4.10 (-0.58%)
Date: Oct 19,2017 EOD




Index Details Steel - Large


Chart

Stock Price Details

Market Statistics

Open Price 708.5 Div Yield (%) 1.42
Buy (Size) 0.00(×0) Eps(Rs) 42.42
Sell (Size) 0.00(×0) Book Value(Rs) 511.3055341
Buy Quantity 0 Market Cap(Rs.Cr) 68412.45
Sell Quantity 0 Face Value(Rs) 10
Today's High 711.45 Market Lot 1
Today's Low 701.3 AGM Date Aug
52-Week High 719.45 Book Closure Date Jul/Aug
52-Week Low 366.05 ISIN No. INE081A01012

Share Holding Pattern

  No Of shares % Share Holding
Total Foreign (Promoter & Group) 0 0.00
Indian (Promoter & Group) 304502341 31.84
Total of Promoter 304502341 31.84
Non Promoter (Institution) 440948923 46.11
Non Promoter (Non-Institution) 210807128 22.05
Total Non Promoter 651756051 68.16
Total Promoter & Non Promoter 956258392 100.00
Custodians(Against Depository Receipts) 0 0.00
Grand Total 956258392 100.00

Company News

16-Oct-2017  Other announcement of TATA STEEL LIMITED
Other announcement of TATA STEEL LIMITED

Certificate under Regulation 61(4) read with Regulation 40(9) of LODR
12-Oct-2017  Tata Steel Limited - Press Release
Tata Steel Limited - Press Release

Tata Steel Limited has informed the Exchange regarding a press release dated October 11, 2017, titled 'Tata Steel strengthens position in low-carbon future technology'.
12-Oct-2017  Tata Steel Limited - Updates
Tata Steel Limited - Updates

Tata Steel Limited has informed the Exchange regarding 'Expiry of share purchase agreement with amtc for acquisition of brahmani river pellets limited.'.
12-Oct-2017  Tata Steel Limited - Analysts/Institutional Investor Meet/Con....
Tata Steel Limited - Analysts/Institutional Investor Meet/Con. Call Updates

Tata Steel Limited has informed the Exchange regarding Analysts/Institutional Investor Meet/Con. Call Updates
11-Oct-2017  Other announcement of TATA STEEL LIMITED
Other announcement of TATA STEEL LIMITED

As attached
11-Oct-2017  Tata Steel Limited - Analysts/Institutional Investor Meet/Con....
Tata Steel Limited - Analysts/Institutional Investor Meet/Con. Call Updates

Tata Steel Limited has informed the Exchange regarding Analysts/Institutional Investor Meet/Con. Call Updates
09-Oct-2017  In Focus: Tata Steel
In Focus: Tata Steel

Shedding flab

The elimination of cash burn in Europe, responsible for high leverage, will reduce and take off the load from Indian operations

Stung by its costly global foray, India’s second largest private sector steel maker by output is focussing on its home base and deleveraging its European operations. Tata Steel and ThyssenKrupp AG will create a 50:50 joint venture (JV) by combining the flat steel businesses of the two companies in Europe and the steel mill services of the German group. The deal does not involve any cash transactions. Both the shareholders will contribute to debt and liabilities, based on fair valuation, to achieve an equal shareholding in the venture.

This business combination creates a strong number two steelmaker in Europe, second only to Arcelor Mittal and will be better positioned to cope with the structural challenges in the European steel industry. The deal is expected to be completed by the end of next year after the two companies receive regulatory approvals.

Steel companies are strengthening their position through cross-border mergers and acquisitions. The focus is on improving existing technology to upgrade production process and developing new value-added-products. Arcelor Mittal along with Nippon Steel and Sumitomo Metal Corporation acquired ThyssenKrupp Steel US in the calendar year (CY) 2014 for US$1,550 million. Essar Global bought Canada-based Algoma Steel for an aggregate value of 1.8 billion Canadian dollars in CY 2007. JSW Steel, the flagship steel company of JSW Group, on 1 December 2016 entered into a consortium to buy 35% stake in Ilva steel plant, in Italy.

Back home, Tata Steel has executed an agreement with Creative Port Development for acquisition of the majority stake, i.e., 51%, in January 2017 for the proposed development of Subarnarekha Port at Chaumukh village of Balasore district in Odisha through a wholly-owned subsidiary, Subarnarekha Port Pvt Ltd. Kirloskar Ferrous Industries on 1 August 2016 announced to take over the pig iron plant of VSL Steels for US$ 23.68 million. JSW Steel picked up the entire 74% holding of Praxair Oxygen Pvt Ltd in their joint venture, JSW Praxair Oxygen, for Rs 240 crore on 18 August 2016, making the industrial gases supplier its wholly owned subsidiary.

The Central government in March 2017 permitted strategic sale of Steel Authority of India’s three units including Alloy Steels Plants, Visvesvaraya Iron and Steel Plant, Salem Steel Plant with the transfer of management. ArcelorMittal SA is looking to set up a JV in India with Sail, to manufacture high-end steel products for use in defence and satellite industries.

In March 2016, Tata Steel had decided to put its entire UK business on sale in the face of a slump in steel demand and prices. It had acquired British steelmaker Corus on 2 April 2007 to move from the world’s 56th largest steelmaker to the sixth-largest. The total payment was US$12.9 billion (Rs 53580 crore), of which US$6 billion was debt. The acquisition of Corus was completed at the peak of the steel cycle that ended with the global financial crisis in CY2008. Steel demand in Europe took a hit.

Corus was renamed Tata Steel Europe in CY 2010.The European steel industry continues to face several including significant third country imports, especially to the UK, a sharp drop in the market spread between steel prices and raw material price basket and very volatile currency movements. The adverse operating environment in Europe affected the consolidated financial performance of Tata Steel

Tata Steel Europe steel deliveries at 9.93 mt were 41.6% of total 23.88 mt of consolidated steel deliveries of Tata Steel in the fiscal ended March 2017 (FY 2017). Sales of the European operations, at Rs 52085 crore, formed 44.4% of the total Rs 117420-crore consolidated sales of the Indian company. Tata Steel Europe reported loss of Rs 4515 crore in FY 2017 compared with consolidated loss of Rs 376.61 crore of Tata Steel.

Tata Steel’s consolidated net debt increased to Rs 74500 crore in FY 2017 from Rs 44400 crore in FY 2016 due to rise in debt of the Europe operations to Rs 51700 crore from Rs 29300 crore and jump in other debt (mainly India) to Rs 22800 crore from Rs 15100 crore.

The joint venture will have a turnover of about Rs 115000 crore per annum. Cost synergies in the range of Rs 2899 crore to Rs 4349 crore per annum are expected through integration of commercial functions, R&D and other supporting activities. The combined earnings before interest, tax, depreciation and amortization (Ebitda) for both the entities is close to Rs 10872 crore without assuming synergies. The Ebitda can increase to Rs 15220 crore on inclusion of cost synergy gains. Thyssenkrupp Tata Steel will have annual shipments of about 21.3 million tonnes (mt) of flat steel products (Tata Steel Europe of 9.8 mt and ThyssenKrupp Steel Europe of 11.5 mt) and a workforce of about 48,000.

Tata Steel will transfer liabilities of around Rs 18120 crore and Thyssenkrupp Rs 28992 crore (mainly Rs 26000 crore of pension liabilities and Rs 2899 crore of other liabilities) to the JV. Assuming Rs 3624 crore of working capital loan, total net debt of the JV will be around Rs 50736 crore. It will be serviced by the JV’s operational profit. Post servicing debt, own capex requirement and other charges, the JV is expected to generate significant free cash flows to be largely distributed as dividends. The JV will have much superior earnings profile and optimal capital structure.

After transferring nearly Rs 17000 crore of the Rs 74000-crore debt in the consolidated books of Tata Steel to the JV, another Rs 17000 crore of debt is of foreign subsidiaries (mostly Singapore) and Rs 40000 crore of Indian operations will remain. The annual payout for Thyssenkrupp liabilities will be close to Rs 1667 crore including servicing costs and some repayments. The debt of foreign subsidiaries, at around 3% finance cost, can be serviced by dividends received from the JV. The remaining debt, pertaining to Indian operations, can be serviced by domestic and residual operations. The interest cost on Tata Steel debt of 3.75% can fall by up to 50 basis points, led by improved credit profile

The elimination of cash burn in Europe, mostly responsible for Tata Steel’s high leverage, will reduce and take off the load from Indian operations. Capital can be allocated to more profitable Indian operations.

Tata Steel is aiming to double the Indian capacity to 26 mt in the next five years. Domestic operations are highly profitable compared with the European operations due to full integration of iron ore requirements and part integration of coking coal requirements. Domestic steel prices have been aided by firm Chinese steel prices, with the downside protected by anti-dumping duties. India Ebitda per tonne was Rs 10623 in Q1 of FY 2017, while Europe’s Ebitda per tonne was Rs 5210. In comparison, JSW Steel’s Ebitda per tonne was Rs 6262 and Sail’s Ebitda per tonne losses were Rs 277, indicating strong profitability of domestic operations.

The Tata Steel stock has not posted any significant gains post the deal as the price has factored in better capital structure in anticipation of the deal. Further re-rating will be driven by movement in spreads and expansion strategy for domestic operations. The share price has risen almost 76% to Rs 648.35 on 27 September 2016 over a year ago. The counter is up 60% since the beginning of CY 2016 due to protectionist measures taken by the Central government, rising steel prices and improving domestic and European performance. Definitive anti-dumping duty for the next four years on steel products has insulated the domestic steel industry from predatory-priced imports, providing floor price to domestic steel players.

Outlook

Tata Steel’s 50:50 JV in Europe has shifted the focus back on its domestic operations that have been funding European cash losses. The JV will benefit from the scale and distribution network capability of the combined assets to achieve quality, technology and cost leadership in the European steel industry.

The proposed transaction in Europe also paves the way for significant de-leveraging of the consolidated balance sheet and provides a platform for Tata Steel to pursue future growth.

The restructuring at Tata Steel comes at a time when the steel industry is headed for a cyclical upturn. China has undertaken initiatives to cut excess capacities citing environmental issues resulting in improvement in global steel prices. In India, government measures to check dumping have resulted in firming up of prices.

An economic slowdown in China had dealt a massive blow to the global steel industry over the last few years. Overcapacity and lower steel prices dented the margins of steel producers. To overcome these negative factors, the Chinese government issued a number of mini-stimulus measures, leading to a short-term boom in infrastructure investment and the housing market, working in favor of the steel industry. Consequently, China’s steel demand grew 1.3% in the calendar year 2016 and the industry has continued to witness strong steel demand since then.

Global steel demand grew 1.8%, while production was up 4.6% in the first six months of CY2017. China also saw a production growth of 4.6%. Although China is closing down some capacity for reasons of low productivity and poor emissions, existing units are delivering more. Global steel capacity utilization gradually increased to 73% in June 2017 from as low as 67.6% in December 2016.

India’s domestic steel production increased 3.5%, while consumption rose 4.6% in the first six months of CY 2017. Imports more or less were stable at around 5.5 lakh tonnes to six lakh tonnes. Indian steel prices improved taking cue from rising international prices.

India’s steel sector of late was affected by intense competitive pressure with a surge in domestic steel production and elevated level of steel imports at predatory pricing. To reduce imports and boost domestic steel manufacturing industry, the government imposed various trade remedial measures such as safeguard duty, anti-dumping duty and minimum import price on various iron and steel products.

With increasing public sector spending, steel producers are seeing traction in the demand from the sectors such as roads, power and transmission lines, solar energy, earthquake equipment, pre-engineering buildings and water and gas pipelines.

Ranking boost
The Tata Steel-Thyssenkrupp joint venture creates a number two steelmaker in Europe
Deliveries (million tonnes) 21.3
Revenue  (Rs crore) 11500
EBITDA (Rs crore) 10872
EBITDA per tonne (Rs) 5104.225
Debt (Rs crore) 50736
-Thyssenkrupp 28992
-Tata steel 18120
- Working Capital 3624
Tata Steel Thyssenkrupp JV : Key Financials
06-Oct-2017  Tata Steel gains after good sales growth in Q2
Tata Steel gains after good sales growth in Q2

The announcement was made after market hours yesterday, 5 October 2017.

Meanwhile, the S&P BSE Sensex was up 146.14 points or 0.46% at 31,738.17.

On the BSE, 15,000 shares were traded on the counter so far as against the average daily volumes of 4.69 lakh shares in the past one quarter. The stock had hit a high of Rs 668.90 and a low of Rs 664.05 so far during the day. The stock had hit a 52-week high of Rs 696.55 on 21 September 2017 and a 52-week low of Rs 366.05 on 21 November 2016.

The stock had outperformed the market over the past one month till 5 October 2017, advancing 1.41% compared with the Sensex's 0.68% fall. The stock had also outperformed the market over the past one quarter, gaining 20.09% as against the Sensex's 1.11% rise. The scrip had also outperformed the market over the past one year, gaining 69.13% as against the Sensex's 11.95% rise.

The large-cap company has equity capital of Rs 971.22 crore. Face value per share is Rs 10.

Tata Steel's production grew by 4.71% to 6.22 million tonnes in Q2 September 2017 over Q2 September 2016.

On a consolidated basis, Tata Steel reported net profit of Rs 921.09 crore in Q1 June 2017, compared with net loss of Rs 3183.07 crore in Q1 June 2016. Net sales rose 18.9% to Rs 29386.76 crore in Q1 June 2017 over Q1 June 2016.

Tata Steel is the world's second-most geographically-diversified steel producer, with operations in 26 countries and commercial presence in over 50 countries.

06-Oct-2017  Tata Steel Limited - Press Release
Tata Steel Limited - Press Release

Tata Steel Limited has informed the Exchange regarding a press release dated October 05, 2017, titled 'Tata Steel?s Q2 & H1 FY18 Key Production and Sales Figure (Provisional)'.
05-Oct-2017  Other announcement of TATA STEEL LIMITED
Other announcement of TATA STEEL LIMITED

Interest Payment Intimation
Incorporation Year 1907 
Registered Office Bombay House,24 Homi Mody Street Fort,
,
Maharashtra-400001
Telephone 91-022-66658282 
Fax 91-022-66657724 
Chairman N Chandrasekaran
Managing Director T V Narendran
Company Secretary K Parvatheesam 
Auditor Deloitte Haskins & Sells LLP 
Face Value(Rs) 10 
Market Lot
Listing London,Luxembourg,MCX-SX,BSE,NSE,Singapore 
Registrar TSR Darashaw Ltd
6-10 Haji Moosa,Patrawala Ind.Estate,DrEMoses Rd Mahalaxm,Mumbai - 400 011 
Toll Free number: 1800-425-5501 / 1800-103-5501
FINANCIAL TOOLS