Tata Steel Limited · NSE:TATASTEEL
Tata Steel — Q4 FY2023 Earnings Presentation
38 slides from Tata Steel's earnings presentation, May 2, 2023
Slide 1: Tata Steel Results Presentation Q4 and FY2023
Preferred option Tata Steel Results Presentation Fourth quarter and Financial year Ended March 31, 2023 Fourthquarter Fourth quarterand andFinancial Financialyear year ended March 31, 2023 Ended March 31, 2023 Steel - Born of Fire, the equation is visually represented in ‘Agni’ sculpture and demonst
Slide 2: 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 3: Performance Update
Performance Update Steel that drives sustainability
Slide 4: Steel prices and spot spreads were volatile on global uncertainties and policy dynamics
Steel prices and spot spreads were volatile on global uncertainties and policy dynamics ▪ Global steel prices have been recovering on improved ▪ Coking coal and Iron ore prices were up while energy costs expectations about economic activity in western markets moderated. Coking coal prices were close
Slide 5: India steel demand grew on government spending; inflationary pressures weighed on EU
India steel demand grew on government spending; Inflationary pressures weighed on fundamentals in EU India Europe ▪ Apparent steel consumption in India was up 14% on YoY ▪ Inflationary pressures and sustained volatility weighed on basis in 4QFY23 and was up 13% on YoY basis for steel fundamentals du
Slide 6: FY23: A year of strategic progress
FY23 : A year of strategic progress Sustainability at core Portfolio alignment with India growth story ▪ Best in Class CO2 footprint in all ▪ Highest annual crude steel geographies production of ~19.9 mn tons ▪ Multiple initiatives underway to 65% ▪ Ongoing capacity expansion at reduce emissions mul
Slide 7: Some milestones we are proud of
Some milestones we are proud of 36 million tons of 500+ kt slag used for 1st in India with Responsible 1st in India to receive license Iron ore mined road construction Steel certification for weather resistant steel Dream Click Build Global Diversity, Equity 60 transgender Rs 1,730 crores sales, Fib
Slide 8: Focused on creating sustainable value
Focused on creating sustainable value Leadership Consolidate Become future in India position as ready global cost leader Leadership position in Leadership in technology Robust financial Sustainability & digital health 8
Slide 9: Pursuing sustainability through multiple pathways
Net Zero by 2045 Pursuing sustainability through multiple pathways Multilocation FY23 progress Various pilots by R&D EAF Lower Adoption of HIsarna Alumina in Iron ore Progress on Higher ▪ Improvement in Blast ▪ Trial for injecting H2 into Hydrogen Renewable furnace fuel rates esp. at blast furna
Slide 10: Focus on 'Zero harm'
Focus on ‘Zero harm’ Committed towards excellence in Safety & Health of employees1 Safety remains a top priority 71% Fatalities 7 LTIFR* 5 In the last 15 years 4 4 4 FY19 FY20 FY21 FY22 FY23 Integrated Integrated Command Command Center Center to monitor SafetyIntegrated Command Leadership Center Dev
Slide 11: 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 Education Household Health & Nutrition 31.5 Lakh+ Lives Impacted1 Tribal Cultural Grassroots Rural ~Rs 1,600 crores Heritage Governance spent2 since FY19 Women & Youth
Slide 12: Growth in India to consolidate market leadership
Growth in India to consolidate market leadership Future investments set to drive sector leading returns Leadership in India 2023 2030 2x Flats Flats ~16 MTPA ~27 MTPA India Crude Steel production by 2030 40 Longs Longs ~5 MTPA ~13 MTPA NINL / MTPA EAF CrudeSteel Crude Steel ~21 MTPA 40 MTPA 0.75 ~21
Slide 13: Flats: 5 MTPA expansion progressing at Kalinganagar
Flats: 5 MTPA expansion progressing at Kalinganagar Value added growth to maintain a future ready portfolio 1st FHCR coil produced from PLTCM TSK 5 MTPA expansion progressing 2.2 MTPA CRM complex : CAL & CGL to be progressively commissioned Pellets being produced from 6 MTPA plant Note: PLTCM – Pick
Slide 14: Longs: Well-placed to more than double the market share
Longs: Well-placed to more than double the market share Multilocational growth plans under execution NINL, a strategic Business model State-of-the-art facility Augmenting acquisition, innovation through EAF to deepen play in downstream capacity ramping up well based Mini Mill Specialty steel Existin
Slide 15: Downstream: Value added growth for product mix enrichment
Downstream: Value added growth for product mix enrichment Tubes, Tinplate and Tata Metaliks Application of tubes in 100 years of leading Tata Ductura, designed a structure at Kolkata tinplate revolution to last for years ▪ Tubes capacity to reach 4 million ▪ Tinplate capacity to reach ~0.7 ▪ Ductile
Slide 16: Tata Steel caters to ~87% of domestic market
India1 Tata Steel caters to ~87% of domestic market Domestic deliveries up 11% on record sales across our chosen segments Business Verticals End use sectors Auto and Retail : Individual mn tons ancillaries housebuilders Packaging 3.8 4.2 2.5 2.8 3.3 2.2 0.5 0.5 0.4 18.3 18.9 17.3 FY21 FY22 FY23 FY21
Slide 17: Financial Results
Financial Results 30+Solar Dome Product In KolkataEngineers Application made with Tata Structura
Slide 18: Financial management to enable returns across cycle
Financial management to enable returns across cycle Medium-term targets (Across cycles) Balance sheet mgmt. Maximising ROIC Target Leverage Investment grade metrices Portfolio restructuring 2x 4x Net Debt/EBITDA Interest Cover Target RoIC1 Dividend Policy Progressive Future readiness Cost optimisati
Slide 19: Maintained strong financial credit metrics
Maintained strong financial credit metrices EBITDA Margin (%)1 EBITDA / ton (Rs.)1 Interest Coverage Ratio (x)1,2 Gross & Net Debt (Rs. crore) 26.2% 21,626 11.7 1,16,328 1,00,816 19.8% 92,147 88,501 18.9% 84,893 1,04,779 75,561 94,879 17.2% 9,337 11,110 5.2 75,389 12.2% 10,838 3.9 3.9 4.1 67,810 6,2
Slide 20: Value accretive consolidation with multiple benefits
Value accretive consolidation with multiple benefits Unlisted Listed TS Mining S&T Mining Indian Steel & TSLP TCIL Tata Metalliks TRF Ltd. Wire Products Swap ratio 6.7 Swap ratio 3.3 Swap ratio 7.9 Swap ratio 1.7 Reduced corporate and Optimal resource use, Faster growth, stronger Provide greater liq
Slide 21: Tata Steel Consolidated 4QFY23
Tata Steel Consolidated (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY23 3QFY23 4QFY22 unless stated otherwise) Production (mn tons)1 7.80 7.56 7.62 ▪ Revenues: increased by 10% primarily driven by India performance. Higher deliveries in Europe were partly Deliveries (mn tons) 7.78
Slide 22: Consolidated 4QFY23 EBITDA stood at Rs 7,225 crores
Consolidated 4QFY23 EBITDA1 stood at Rs 7,225 crores EBITDA margin improved from 5% in 3Q to 11% in 4Q primarily driven by India in Rs crores 279 7,225 ▪ Selling Result: Drop in realisation in Europe 710 partly offset by rise in India 1,088 ▪ Cost Changes: due to decline in raw material costs especi
Slide 23: Tata Steel Consolidated FY2023
Tata Steel Consolidated (All figures are in Rs. Crores FY2023 FY2022 Key drivers for YoY change: unless stated otherwise) Production (mn tons)1 30.65 31.03 ▪ Revenues: were broadly stable as increase at Tata Deliveries (mn tons) Steel India was offset by lower revenues at SE Asia 28.79 29.52 followi
Slide 24: Consolidated FY23 EBITDA stood at Rs 30,117 crores
Consolidated FY23 EBITDA1 stood at Rs 30,117 crores Margin compression primarily due to higher material costs 2,633 in Rs crores - 65,483 ▪ Selling Result: Primarily due to elevated steel realisations in Europe esp. in 1HFY23 38,070 ▪ Cost Changes: increased due to higher material costs especially c
Slide 25: Net debt stood at Rs 67,810 crores
Net debt stood at Rs 67,810 crores Decreased by ~Rs. 3,900 crores during the quarter in Rs crores 893 3,682 87,649 33 84,893 17,083 67,810 Gross Debt Addition of Loan FX Impact Gross Debt Cash, Bank & Net Debt Dec'22 new leases movement and Others Mar'23 Current Mar'23 Investments Note : All data is
Slide 26: Annexures
Annexures Zinc Drossing Robot at Tata Steel Meramandali
Slide 27: Continued focus on operational efficiencies and minimizing environmental impact
Tata Steel Standalone Continued focus on operational efficiencies and minimizing environmental impact Coke Rate (kg/thm) Specific Energy Consumption (Gcal/tcs) Specific Fresh Specific Water Fresh Consumption (m3/tcs) Water Good Good 3 Consumption (m /tcs) Good 363 3.50 356 5.84 355 353 5.80 3.10 5.7
Slide 28: Tata Steel Standalone
Tata Steel Standalone (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY23 3QFY23 4QFY22 unless stated otherwise) Production (mn tons) 4.82 4.77 4.73 ▪ Revenues: increased on improved volumes and higher Deliveries (mn tons) net realisations 4.98 4.59 4.97 Total revenue from operations 3
Slide 29: Key operating parameters: TSUK and TSN
TSUK TSN Key operating parameters Coke Rate (kg/thm) Specific Energy Consumption (GJ/tcs) CO2 Emission Intensity (tCO2/tcs) Good Good Good 337 324 322 317 24.2 23.9 311 23.3 23.1 22.8 2.25 2.23 2.18 2.16 300 2.14 20.4 20.2 20.0 19.8 19.5 291 1.78 1.77 1.77 1.76 1.76 279 275 275 FY19 FY20 FY21 FY22 F
Slide 30: Tata Steel Europe
Tata Steel Europe (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY23 3QFY23 4QFY22 unless stated otherwise) ▪ Revenues: were higher driven by improved volumes, Liquid Steel production (mn tons) 2.27 2.24 2.31 this was partly offset by drop in realisations Deliveries (mn tons) 2.16 1.9
Slide 31: Key operating parameters: Tata Steel Long Products
Tata Steel Long Products Key operating parameters Coke rate (kg/thm) PCI rate (kg/thm) Carbon Emission (tCO2/tcs) Good Good Good 4.5 4.4 4.3 128 4.0 116 114 111 503 500 486 474 FY21 FY20 FY21 FY22 FY23 FY20 FY21 FY22 FY23 FY20 FY22 FY23 Power consumption (kVAh/tcs) Electrode consumption (kg/tcs) Cru
Slide 32: Tata Steel Long Products (Consolidated with NINL)
Tata Steel Long Products (Consolidated with NINL) (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY231 3QFY231 4QFY22 unless stated otherwise) ▪ Revenues: increased driven by ramp up at NINL during Total revenue from operations 3,016 2,113 1,799 the quarter. NINL is presently operating
Slide 33: Key operating parameters: Tinplate Company of India
Tinplate Company of India Limited Key operating parameters CO2 Emission Intensity (tCO2/tFP) Fresh Water Consumption (m3/tFP) Good Good 13.7 13.0 0.71 12.4 12.2 12.1 0.66 0.65 0.64 0.62 FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22 FY23 Power consumption (kWh/tFP) CRM Material Yield (%) Good Good 449
Slide 34: Tinplate Company of India Limited
Tinplate Company of India Limited (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY23 3QFY23 4QFY22 unless stated otherwise) ▪ Revenues: increased on higher sales volumes on QoQ Total revenue from operations 1,033 960 1,227 basis Raw material cost1 672 688 757 ▪ Raw Material cost: were
Slide 35: Key operating parameters: Tata Metaliks
Tata Metaliks Key operating parameters Carbon Emission (tCO2/thm) Energy Consumption Intensity (GJ/thm) Pig Iron business Good Good 1.95 19.6 1.87 1.83 18.7 18.5 1.75 1.73 17.8 17.8 FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22 FY23 Ductile Iron Pipe business Carbon Emission (tCO2/tFP) Energy Consump
Slide 36: Tata Metaliks Limited
Tata Metaliks Limited (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY23 3QFY23 4QFY22 unless stated otherwise) ▪ Revenues: increased driven by higher deliveries of Total revenue from operations 930 792 815 Ductile Iron Pipe (+33%) and improved realisations Raw material cost1 574 536
Slide 37: Tata Steel Thailand
Tata Steel Thailand (All figures are in Rs. Crores Key drivers for QoQ change: 4QFY23 3QFY23 4QFY22 unless stated otherwise) ▪ Deliveries: were slightly higher on QoQ basis Saleable Steel production (mn tons) 0.31 0.27 0.34 ▪ Revenues: increased on higher volumes and improved Deliveries (mn tons) 0.
Slide 38: Investor Relations Contact
Investor Relations Contact Investor enquiries Hriday Nair hnair@tatasteel.com Pavan Kumar pavan.kumar@tatasteel.com