Low global steel prices in December quarter sent Tata Steel Ltd into the red, with India’s largest private sector steelmaker reporting a consolidated net loss of ₹1,228.53 crore against net profit of ₹1,753 crore in the year-ago period.
Consolidated Indian operations reported PAT was ₹1,194 crores during the quarter against ₹2254 core in the corresponding period of the previous year.
Consolidated revenue fell 8.9 percent on year to ₹35,520 crore during Q3, even though steel sales rose 13 percent to 7.31 million tons (mt) from 6.47 mt a year ago.
Operating profit or EBIDTA per ton fell to ₹5,003 from ₹10,404 in Q3 FY19.
“Selling results reflects sequentially lower steel realizations. Cost improvement is primarily due to lower coal cost and lower consumption of purchased pellet. Volume mix impact primarily due to higher deliveries, partially offset by adverse mix impact due to higher exports,” Tata Steel said in an investors’ presentation.
Total deliveries grew 17 percent on quarter with 15 percent increase in domestic deliveries; despite 3 percent decline in India’s apparent steel consumption.
The company maintained automotive segment deliveries on sequential basis amidst 13 percent decline in auto industry production.
Branded products and retail segment and industrial product and projects segment deliveries grew 22 percent and 12 percent on quarter, respectively.
“In India, our business model helped us counter the slowdown as we successfully penetrated new markets and expanded our customer universe. We were also able to maintain our sales to the auto segment despite the sluggishness faced by the auto industry,” TV Narendran, CEO and managing director of Tata Steel said.
Both of its recent acquisitions, Tata Steel BSL and Tata Steel Long Products, delivered operational improvements.
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