Tata Steel Unconcerned About Demand Slowdown in India

SEATTLE (Scrap Monster): TV Narendran, Managing Director of leading steelmaker Tata Steel provided an outlook on the company’s operations in the near future, amidst weak global markets.

According to him, the company is not much concerned about the anticipated demand slowdown in India. The demand from the auto sector remained strong, but the demand from construction sector was not up to expectations. The rural markets have already started to pick up and a good monsoon will ensure a better second half during the year. More concerning is the demand from China, which has been disappointing, he added.

Last year, the company’s India operations recorded EBITDA margin of 20% and net profit of INR 4,100 crore. The performance remained strong, despite challenging market situation. The negative PAT by the Netherlands unit is attributed to the realignment of blast furnace. The company expects the operations to return on track from September quarter onwards, Narendran said.

Tata Steel noted that it has already spent INR 4,000 crore in Q1 2023, out of the total capital expenditure plan of INR 16,000 crore for the whole year. The debt levels have gone higher, mainly due to higher working capital, it said.