Tata Steel Limited · NSE:TATASTEEL
Tata Steel — Q4 FY2024 Earnings Presentation
44 slides from Tata Steel's earnings presentation, May 29, 2024
Slide 1: Exchange filing cover letter
May 29, 2024 The Secretary, Listing Department The Manager, Listing Department BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers, Exchange Plaza, 5th Floor, Plot No. C/1, Dalal Street, G Block, Bandra-Kurla Complex, Bandra (E), Mumbai - 400 001. Mumbai - 400 051. Maharas
Slide 2: Tata Steel reports Consolidated EBITDA of Rs 23,402 crores for FY2024
Mumbai, May 29, 2024 Tata Steel reports Consolidated EBITDA of Rs 23,402 crores for FY2024 Highlights: ▪ Consolidated Revenues for the Jan – March 2024 quarter stood at Rs 58,687 crores, up 6% QoQ on improved volumes across geographies. EBITDA was at Rs 6,631 crores with an EBITDA margin of ~11%. ▪
Slide 3: Management Comments
financials are calculated using crude steel for India, liquid steel for UK & Netherlands and saleable steel for South East Asia; 4. Adjusted for changes on account of FX movement on intercompany debt / receivables Management Comments: Mr. T V Narendran, Chief Executive Officer & Managing Director: “
Slide 4: About Tata Steel
For queries and information Sarvesh Kumar, Chief Corporate Communications, Tata Steel, sarvesh.kumar@tatasteel.com About Tata Steel • Tata Steel group is among the top global steel companies with an annual crude steel capacity of 35 million tonnes per annum. • It is one of the world's most geographi
Slide 5: Tata Steel Results Presentation
Tata Steel Results Presentation Fourth quarter and Financial year ended 31st March 2024 May 29, 2024
Slide 6: Safe harbour statement
Safe harbour statement Statements in this presentation describing the Company’s performance may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results may differ materially from those directly or indirectly expressed, inferred or implied. Imp
Slide 7: Structural trends are reshaping global steel industry dynamics over time
Structural trends are reshaping global steel industry dynamics over time China’s transition to Focus on Geopolitical Technological consumption led Decarbonisation events / progress growth across sectors conflicts Rise in Heightened protectionism volatility Global Steel Productivity and trade competi
Slide 8: India steel remains a bright spot aided by the economic growth cycle
India steel remains a bright spot aided by the economic growth cycle India steel demand forecast (in mn tons) 120 Urbanisation Capex cycle Rise in living standards Megacities National Infra Rise in FY23 FY24 FY26 FY28 FY30 plan (NIP) Consumption Apparent steel use and GDP per capita China Connectivi
Slide 9: Tata Steel is focused on creating sustainable value
Tata Steel Leadership position in is focused Leadership in Sustainability Leadership in India technology and digital on creating sustainable value Consolidate position as global cost leader Robust financial health Become future ready Results Presentation, May 2024 5
Slide 10: Our Journey so far
Our Journey so far … Consistent growth at India operations… …with industry leading profitability (in million tons) (EBITDA margin %) FY2024 Highlights 2x volume growth in India Average India EBITDA margin 39% 27% ▪ Highest annual crude steel production 20 24% 22% 22% 20% of around 21 mn tons in Indi
Slide 11: Some milestones we are proud of
Some milestones we are proud of 38 million tons of Iron ore Consistently filed 100+ Tata Tiscon Retail sales cross Far site remote operation mined in India patents 2 million tons centers Sustainability champion seven >90% India prodn. via sites Partnerships to drive 4 million+ lives impacted years i
Slide 12: We are committed to 'Zero harm'
We are committed to ‘Zero harm’ Journey towards excellence in Safety & Health of employees1 Focus on safety practices to improve risk perception among workforce Fatalities LTIFR* 7 In the last 15 years 4 4 5 4 FY20 FY21 FY22 FY23 FY24 Full-scale mock drill at Tata Steel Meramandali Life Saving Rules
Slide 13: Improving quality of life of our communities
Improving quality of life of our communities Social capital and scalable change models to enable deep societal impact Rural & Urban Public Health Grassroots 44 Lakh+ Education & Nutrition Sports Lives Impacted1 Structured learning for 19,700+ high risk 36,000+ individuals 7.2 lac+ children pregnant
Slide 14: Aligned with the UN SDG framework to ensure a better future
Aligned with the UN SDG framework to ensure a better future 68 targets have been prioritised across 15 UN SDGs Skill development Maternal & Newborn Survival Initiative Water conservation (MANSI+) Youth enrolled for employability and Under-5 children with SAM and Water recharge potential created skil
Slide 15: Business Update
Business Update Piloting new technologies in partnership with academia and technology partners. 3 of our manufacturing plants recognised as WEF Lighthouse, a network that spotlights leaders of the Fourth Industrial revolution
Slide 16: Sustainability is at the core of our strategy
Sustainability is at the core of our strategy Our sustainability framework guides deployment of sustainability initiatives across value chain Results Presentation, May 2024 Note : HR: Human Resource, POSH: Prevention of sexual harassment, SC: Supply Chain, ABAC: Anti-Bribery and Anti-Corruption , AM
Slide 17: Route and Pace of decarbonisation to be calibrated across geographies
Route and Pace of decarbonisation to be calibrated across geographies India UK Netherlands Steel - permanent material in Net Zero by 2045 the circular economy ▪ Key engineering and construction material ▪ Various pilots to avoid or convert captured carbon emissions ▪ Essential for economic ▪ Partner
Slide 18: India: Pursuing sustainability through multiple initiatives
India : Pursuing sustainability through multiple initiatives Committed to responsible growth while Focus on greening energy mix and progressing on decarbonisation nature-based solutions Carbon reductions through Process improvement Carbon Direct Avoidance Carbon Capture & Utilisation ▪ CCU pilot pla
Slide 19: UK: Pursuing decarbonisation to reduce 50 mn tons CO2e over a decade
UK: Pursuing decarbonisation to reduce 50 mn tons CO2e over a decade Tentative timelines May 2024 June 2024 Sep 2024 Aug 2025 2027 Q3 2024 Committed availability Launch of Voluntary Closure of remaining Initiation of EAF Closure of one of the of High Voltage Infra; Redundancy Aspiration BF and equip
Slide 20: Tata Steel is scaling up to capitalise on India growth opportunity
Tata Steel is scaling up to capitalise on India growth opportunity Investments set to drive sector leading returns 2x 40 capacity growth in NINL / MTPA Flats (A) ~16 MTPA ~27 MTPA India EAF Longs (B) ~5 MTPA ~13 MTPA Dominant manufacturing base 0.85 ~21 EAF TSK / Crude Steel ~21 MTPA 40 MTPA MTPA 5
Slide 21: Phased commissioning of 5 MTPA expansion at Kalinganagar
Phased commissioning of 5 MTPA expansion at Kalinganagar The largest ‘Blast furnace’ in India at 5,870 cubic metres Stove heating initiated at the 5 MTPA blast furnace CAL – Lasers trials underway 6 MTPA capacity pellet plant operational Results Presentation, May 2024 Note : CAL - Continuous Anneali
Slide 22: Capacity growth to aid continued strong presence across segments
Capacity growth to aid continued strong presence across segments Leadership in chosen segments 1 in 3 outer 2 in 1st 3 of every 5 panels of every branded CR LPG cars 3 Wheels in India cylinders 85+ >2,000 km Green Pro 1 in every micro Oil & Gas Certified 2 GC segments pipeline products roofs Custome
Slide 23: Auto: Consolidating the position of Preferred Steel Supplier
Auto: Consolidating the position of “Preferred Steel Supplier” ▪ Strong presence across all the ▪ Enriched product offerings with automotive OEMs hi-end grades from new facilities Auto as % of total deliveries 6% YoY growth in high end auto sales 22% 23% 21% FY22 FY23 FY24 ▪ Value creation for custo
Slide 24: Retail: Poised to grow 2x in high margin business
Retail: Poised to grow 2x in high margin business Leveraging pan India growth and branded presence especially Tata Tiscon Tiscon Retail Sales in mn tons Physical + Digital Reach 2.0 1.8 1.5 Doubled Dealer base in the last 2 years FY22 FY23 FY24 Consistent growth in sales driven by 26% 19% 2,240 ▪ Ca
Slide 25: Shaping construction market practices through ready-to-use solutions
Shaping construction market practices through ready-to-use solutions Service centers enabling offsite construction with better value proposition Footprint across India Simplifying customer journey for Construction & Infrastructure 33 Construction Service Centers1 7 new service centers opened across
Slide 26: New products developed across customer segments
New products developed across customer segments Bright finish Wheel CR Grade for automotive Cabin top for Three- rim for Two-wheeler application wheelers HSLA340 - bracket, reinforcement CR340LA : Two-wheeler Two - wheeler fuel for Three-wheeler stamp outer & inner tank (Galvannealed) HSLA340 - whee
Slide 27: Financial Management to enable returns across cycle
Financial Management to enable returns across cycle Value Drivers Balance sheet management Capital allocation Operational excellence • Optimise capital structure and cost • Value accretive investments • Minimize working capital • Target Net Debt to EBITDA <2.5x across (ROIC : 15%) cycle • Proactive
Slide 28: Performance update
Performance update Sustainable shipping - 1st Indian company to import raw material, powered by biofuel blend with Very Low Sulphur Fuel Oil, leading to 20% less carbon emissions vs. traditional method
Slide 29: Steel spot spreads improved on moderation in raw material prices
Steel spot spreads improved on moderation in raw material prices ▪ Global steel prices moderated in the Jan – Mar’24 period ▪ Raw material prices moved lower during the quarter; across key regions. US steel prices were down around 25% Coking coal prices declined nearly 23% to around $250/t while EU
Slide 30: India steel demand continued to improve while EU demand was subdued
India steel demand continued to improve while EU demand was subdued India Europe ▪ Indian apparent steel demand continued to grow aided ▪ EU manufacturing PMI remained subdued between 45 to by government spending and consumption 47 levels during Jan – Mar’24 ▪ Auto, Infrastructure & Construction and
Slide 31: In FY2024, Tata Steel India deliveries grew by 6% YoY to ~19.9 mn tons
In FY2024, Tata Steel India deliveries grew by 6% YoY to ~19.9 mn tons Business Verticals End use sectors mn tons Auto and Retail : Individual Construction & ancillaries housebuilders Infrastructure 19.9 4.5 4.2 5.0 18.3 18.9 3.8 3.1 4.2 4.6 2.5 2.8 2.91 2.56 2.69 FY22 FY23 FY24 FY22 FY23 FY24 FY22
Slide 32: Tata Steel Consolidated 4QFY24
Tata Steel Consolidated (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY24 3QFY24 4QFY23 unless stated otherwise) Production (mn tons)1 7.92 7.58 7.80 ▪ Revenues: increased by 6% on higher volumes despite lower steel realisations across geographies Deliveries (mn tons) 7.98 7.15 7.78
Slide 33: Consolidated 4QFY24 EBITDA stood at Rs 6,969 crores
Consolidated 4QFY24 EBITDA1 stood at Rs 6,969 crores - 261 812 ▪ Selling Result: driven by lower realisations - across geographies 2,597 ▪ Cost Changes: have been primarily driven by 1,921 lower royalty related expenses in India and relining expenses in Netherlands 6,969 5,742 ▪ Volume/Mix: primaril
Slide 34: Tata Steel Consolidated FY2024
Tata Steel Consolidated (All figures are in Rs. Crores FY2024 FY2023 Key drivers for QoQ change: unless stated otherwise) Production (mn tons)1 29.94 30.65 ▪ Revenues: decreased by 6% due to lower realisations Deliveries (mn tons) 29.39 28.79 partly offset by higher India volumes Total revenue from
Slide 35: Consolidated FY2024 EBITDA stood at Rs 23,096 crores
Consolidated FY2024 EBITDA1 stood at Rs 23,096 crores ▪ Selling Result: has been driven by lower realisations across geographies 4,344 2,163 - 21,456 ▪ Cost Changes: primarily reflecting the decline in raw material costs esp. Coking coal 16,615 30,117 ▪ Volume/Mix: Relining of BF6 of Netherlands 23,
Slide 36: Net debt stood at Rs 77,550 crores
Net debt stood at Rs 77,550 crores Group liquidity remains strong at Rs 31,7671 crores in Rs crores 380 1,361 167 88,230 87,082 9,532 77,550 Gross Debt Movement in Loan FX Impact Gross Debt Cash, Bank & Net Debt Dec'23 leases movement and Others Mar'24 Current Mar'24 Investments 32 1 Group liquidity
Slide 37: Key financial credit metrices
Key financial credit metrices EBITDA Margin (%)1 EBITDA / ton (Rs.)1 Interest Coverage Ratio (x)1,2 Gross & Net Debt (Rs crores) 26.2% 21,626 11.7 1,16,328 1,00,816 19.8% 88,501 84,893 87,082 18.9% 1,04,779 75,561 94,879 11,358 11,110 5.2 77,550 75,389 12.2% 13.4% 10,838 7,962 3.9 4.1 67,810 6,267 3
Slide 38: Annexures
Annexures Leveraging technology to drive process efficiency – Driver Training Simulator at Tata Steel Meramandali, India
Slide 39: Tata Steel Standalone operating parameters
Tata Steel Standalone Continued focus on operational efficiencies and minimizing environmental impact Coke Rate (kg/thm) Specific Energy Consumption (Gcal/tcs) Specific Fresh Water Consumption (m3/tcs) Good Good Good 6.00 365 362 3.51 5.95 357 3.20 348 339 2.84 5.85 2.74 2.44 5.68 5.63 FY20 FY21 FY2
Slide 40: Tata Steel Standalone
Tata Steel Standalone1 (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY24 3QFY24 4QFY23 unless stated otherwise) Production (mn tons) 5.24 5.13 5.01 ▪ Revenues: were higher primarily driven by improved Deliveries (mn tons) 5.42 5.15 volumes in a seasonally stronger quarter 4.88 Total
Slide 41: Key operating parameters TSUK and TSN
TSUK TSUK TSN Key operating parameters Coke Rate (kg/thm) Specific Energy Consumption (GJ/tcs) CO2 Emission Intensity (tCO2/tcs) Good Good Good 340 337 324 317 23.9 311 23.3 23.1 23.1 22.8 2.25 2.18 2.16 300 2.15 2.14 298 20.9 20.4 20.2 19.8 19.5 291 1.81 1.78 1.77 1.76 1.76 279 275 FY20 FY21 FY22 F
Slide 42: Tata Steel Netherlands
Tata Steel Netherlands (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY24 3QFY24 4QFY23 unless stated otherwise) ▪ Deliveries: moved higher by 11% on higher production Liquid Steel production (mn tons) 1.48 1.19 1.53 enabled by completion of reline of BF6 in early February Deliveries
Slide 43: Tata Steel UK
Tata Steel UK (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY24 3QFY24 4QFY23 unless stated otherwise) ▪ Deliveries: moved higher by 9% Liquid Steel production (mn tons) 0.66 0.72 0.74 ▪ Revenues: increased on account of higher volumes Deliveries (mn tons) 0.69 0.64 0.76 despite lowe
Slide 44: Tata Steel Investor Relations
Tata Steel Investor Relations Investor enquiries ir@tatasteel.com Tata Archery Academy – Nurturing sports at Grassroots level