MIRA INFORM REPORT

 

 

Report Date :

16.02.2011

                                    

IDENTIFICATION DETAILS

 

Name :

TATA STEEL LIMITED

 

 

Registered Office :

Bombay House, 24, Homi Mody Street, Fort, Mumbai - 400 001, Maharashtra

 

 

Country :

India

 

 

Financials (as on) :

31.03.2010

 

 

Date of Incorporation :

26.08.1907

 

 

Com. Reg. No.:

11-260

 

 

CIN No.:

[Company Identification No.]

L27100MH1907PLC000260

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

MUMT00249E

MUMT10796C

 

 

PAN No.:

[Permanent Account No.]

AAACT2803M

AAATT0188H

 

 

Legal Form :

Public Limited Liability Company. The company’s shares are listed on the Stock Exchanges.

 

 

Line of Business :

Manufacturers of saleable steel, ferro manganese, charge chrome, welded steel tubes, cold rolled strips, seamless tubes, carbon and alloy steel bearing rings, annular forgings and flanges, metallurgical machinery, ammonium sulphate, ordinary cement, fortland blast furnace slag cement, alloy steel ball bearing rings and bearings.

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Aa (78)

 

RATING

STATUS

PROPOSED CREDIT LINE

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

Large

 

Maximum Credit Limit :

USD 1478000000

 

       

Status :

Good

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Clear

 

 

Comments :

Subject is a well established and a reputed TATA Group company. The country’s premier industrial house. Available information indicates high financial responsibility of the company.

 

Financial position of the company is sound. Payments are reported to be regular.

 

The company can be considered good for normal business dealings at usual terms and conditions.

 

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

ECGC Country Risk Classification List – April 1, 2010

 

Country Name

Previous Rating

(31.12.2009)

Current Rating

(01.04.2010)

India

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

LOCATIONS

 

Registered Office :

Bombay House, 24, Homi Mody Street, Fort, Mumbai - 400 001, Maharashtra, India

Tel. No.:

91-22-56658282 / 66658282

Fax No.:

91-22-56658113 / 56658119 / 66657725/ 24

E-Mail :

tatasteelho@tata.com

cosectisco@tata.com 

Website :

http://www.tata.com/tatasteel

http://www.tatasteel.com

 

 

Corporate Office:

Design Call, 3rd Floor, General Office, Tata Steel, Jamshedpur – 831 001, India

Websites:

www.tatasteel.com

 

 

Factory 1 :

Agrico and Tubes Division

43, Jawaharlal Nehru Road, Tata Centre, 3rd Floor, Kolkata – 700071, West Bengal, India

Tel. No.:

91-33-22885930/65508120/65508021/2288-3425 / 2224-8536

Fax No.:

91-33-22886996/91-33-2288-8850

 

 

Factory 2 :

Bearings Division

43, Jawaharlal Nehru Road, Tata Centre, 11th Floor, Kolkata – 700071, West Bengal, India

Tel. No.:

91-33-22248672/8187/65508006

Fax No.:

91-33-22881962

 

 

Factory 3 :

Flat Products Division

43, Jawaharlal Nehru Road, Tata Centre, 7th Floor, Kolkata – 700071, West Bengal, India

Tel. No.:

86608197/86608626/1800-3458282 (Toll Free)

 

 

Factory 4 :

Long Products Division

43, Jawaharlal Nehru Road, Tata Centre, 15th Floor, Kolkata – 700071, West Bengal, India

Tel. No.:

91-33-22882278/22248104

Fax No.:

91-33-22881640/1163

 

 

Factory 5 :

FAMD

43, Jawaharlal Nehru Road, Tata Centre, 12th Floor, Kolkata – 700071, West Bengal, India

Tel. No.:

91-33-22882736/65508134

Fax No.:

91-33-22885015

 

 

Factory 6 :

Bamnipal - 758 082, District - Keonjhar, Orissa, India

Tel. No.:

91-6726-243361

Fax No.:

91-6726-243324

 

 

Branches :

43, Chowringhee Road, Kolkata – 700 071, West Bengal

Tel. No.:

91-657-2431024

Fax No.:

91-657-2431818

 

 

International Offices :

Located at:

  • Australia
  • Vietnam
  • China
  • Nepal
  • Malaysia
  • Phillippines
  • UAE
  • Singapore
  • South Africa
  • UK
  • Srilanka
  • USA
  • Thailand

 

 

DIRECTORS

 

As On 31.03.2010 

 

Name :

Mr. Ratan N. Tata

Designation :

Chairman

 

 

Name :

Mr. B. Muthuraman

Designation :

Managing Director

 

 

Name :

Mr. Nusli N. Wadia

Designation :

Director

 

 

Name :

Mr. S. M. Palia

Designation :

Director

 

 

Name :

Mr. P. K. Kaul

Designation :

Director – Nominee [IDBI]

 

 

Name :

Mr. Suresh Krishna

Designation :

Director

 

 

Name :

Mr. Kumar Mangalam Birla

Designation :

Director

 

 

Name :

Mr. Ishaat Hussain

Designation :

Director

 

 

Name :

Dr. Jamshed J. Irani

Designation :

Director

 

 

Name :

Mr. B. Jitender

Designation :

Director

 

 

Name :

Dr. T. Mukherjee

Designation :

Deputy Managing Director

 

 

Name :

Mr. A. N. Singh

Designation :

Director

 

 

Name :

Mr. Subodh Bhargava

Designation :

Additional Director

 

 

Name :

Mr. Philippe Varin

Designation :

Director

 

 

Name :

Mr. Jacobus Schraven

Designation :

Director

 

 

Name :

Mr. Anthony Hayward

Designation :

Director

 

 

Name :

Mr. James Leng

Designation :

Deputy Chairman

 

 

Name :

Mr. Andrew Robb

Designation :

Additional Director

 

 

KEY EXECUTIVES

 

Name :

Mr. J C Bham

Designation :

Company Secretary

 

 

Name :

Mr. H M Nerurkar

Designation :

Chief Operating Officer

 

 

Name :

Mr. A D Baijal

Designation :

Vice President and  Tata Steel Group Director, Global Mineral Resources

 

 

Name :

Mr. R P Singh

Designation :

Vice President, Engineering Services and  Projects

 

 

Name :

Mr. Koushik Chatterjee

Designation :

Vice President, Finance and Tata Steel Group CFO

 

 

Name :

Mr.  Anand Sen

Designation :

Vice President, Flat Products and TQM

 

 

Name :

Mr. Abanindra M. Misra

Designation :

Vice President, Raw Materials and CSI

 

 

Name :

Mr. Kirby Adams

Designation :

Chief Executive Officer (Tat Steel Europe)

 

 

Name :

Mr.  Varun K Jha

Designation :

Vice President, Chattisgarh Project

 

 

Name :

Mr.  Om Narayan

Designation :

Vice President, Shared Services

 

 

Name :

Mr.  Radhakrishnan Nair

Designation :

Chief Human Resource Officer

 

 

Name :

Mr.  Partha Sengupta

Designation:

Vice President, Corporate Services

 

 

Name :

Mr.  H Jha

Designation:

Vice President, Safety and Long Products

 

 

Name :

Mr. N K Misra

Designation:

Vice President and  Tata Steel Group Head, M and A

 

 

Name :

Mr.  B K Singh

Designation:

Vice President, Orissa Project

 

 

Name :

Mr. H C Kharkar

Designation:

Vice President, MD Office, Mumbai

 

 

Name :

Mr. Jean Sebastien Jacques

Designation :

Group Director (strategy)

 

 

Name :

Mr. Manzeer Hussain

Designation :

Group Director (Communications)

 

 

Name :

Mr. Avneesh Gupta

Designation :

Group Director (Total Quality Management)

 

 

Name :

Mr. Marjan Oudeman

Designation :

Divisional Director (Strip Products) TSE

 

 

Name :

Mr. Scott MacDonald

Designation :

Divisional Director (Distribution and Building Systems), TSE

 

 

Name :

Mr. Phil Dryden

Designation :

Divisional Director (Long Products) TSE

 

 

Name :

Mr. Frank Royle

Designation :

Director (Finance) TSE

 

 

Name :

Mr. Tor Farquhar

Designation :

Director (Human Resources) TSE

 

 

Name :

Mr. Santi Charnkolrawee

Designation :

President Tata Steel Thailand

 

 

Name :

Mr. T.V. Narendran

Designation :

President and Chief Executive Officer Natsteel Holdings

 

 

Name :

Mr. V.S.N. Murty

Designation :

Chief Fiannacial Controller (Corporate) TSL

 

 

Name :

Mrs. Helen Matheson

Designation :

Director (Legal, Compliance and Secretariat)TSE

 

 

Name :

Mr. Sandip Biswas

Designation :

Group Head (Corporate Finance, Treasury and Investor Relations)

 

 

Name :

Mr. Lim Say Yan

Designation :

Group Head (Corporate Assurance and Risk Management)

 

 

Name :

Mr. Bimlendra Jha

Designation :

Principal Executive Officer to Managing Director TSL

 

 

Name :

Dr. Debashish Bhattacharjee

Designation :

Director (Research, Development and Technology)

 

 

MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN

 

As on 31.12.2010

 

Names of Shareholders

No. of Shares

Percentage of Holding

(A) Shareholding of Promoter and Promoter Group

 

 

(1) Indian

 

 

Bodies Corporate

292,453,780

32.81

Any Others (Specify)

1,031,460

0.12

Trusts

1,031,460

0.12

Sub Total

293,485,240

32.93

(2) Foreign

 

 

Total shareholding of Promoter and Promoter Group (A)

293,485,240

32.93

(B) Public Shareholding

 

 

(1) Institutions

 

 

Mutual Funds / UTI

30,265,676

3.40

Financial Institutions / Banks

2,323,932

0.26

Central Government / State Government(s)

121,659

0.01

Insurance Companies

203,727,268

22.86

Foreign Institutional Investors

144,330,870

16.19

Any Others (Specify)

1,457,376

0.16

Foreign Institutional Investors - DR

1,382,511

0.16

Foreign Bodies DR

74,865

0.01

Sub Total

382,226,781

42.88

(2) Non-Institutions

 

 

Bodies Corporate

28,479,895

3.20

Individuals

 

 

Individual shareholders holding nominal share capital up to Rs. 0.100 million

161,672,649

18.14

Individual shareholders holding nominal share capital in excess of Rs. 0.100 million

25,430,088

2.85

Any Others (Specify)

5,925

-

Foreign Corporate Bodies

5,925

-

Sub Total

215,588,557

24.19

Total Public shareholding (B)

597,815,338

67.07

Total (A)+(B)

891,300,578

100.00

(C) Shares held by Custodians and against which Depository Receipts have been issued

-

-

(1) Promoter and Promoter Group

-

-

(2) Public

10,913,618

-

Sub Total

10,913,618

-

Total (A)+(B)+(C)

902,214,196

-

 

 

BUSINESS DETAILS

 

Line of Business :

Manufacturers of saleable steel, ferro manganese, charge chrome, welded steel tubes, cold rolled strips, seamless tubes, carbon and alloy steel bearing rings, annular forgings and flanges, metallurgical machinery, ammonium sulphate, ordinary cement, fortland blast furnace slag cement, alloy steel ball bearing rings and bearings

 

 

Products:

Items Code No.

 

Product Description

72082600

Flat Rolled Products of Non Alloy Steel of a width of 600 mm and more hot rolled coils of thickness 1.6 mm to 12 mm

73045901

Tubes/Pipes etc. of circular section with outer diameter upto 114.3 mm, not cold rolled

72091600 / 72091700

Flat Rolled Products of Non Alloy Steel of a width of 600 mm or more, cold(cold reduced), not clad, plated or coated of thickness 0.5 mm or more but less than 3 mm

 

 

 

GENERAL INFORMATION

 

No. of Employees :

38000 (approximately)

 

 

Bankers :
  • State Bank of India, Madame came Road, Mumbai – 400 021
  • Central Bank of India, Madras Stock Exchange building, 11, 2nd Line Beach, Chennai – 600 001
  • Standard Chartered Bank, 4,Netaji Subhas Road, Kolkata – 700001
  • Industrial Development Bank of India
  • Citibank International p.l.c.

 

 

Facilities :

Secured Loans

31.03.2010 (Rs. In Millions)

31.03.2009 (Rs. In Millions)

Joint Plant Committee-Steel Development Fund [including funded interest Rs. 2511.100 millions (31.03.2009 : Rs. 2339.100 millions)]

18055.400

17524.000

14.25% Non-Convertible Debentures (privately placed with LIC Mutual Fund)

0.000

85.000

10.50% Non-Convertible Debentures (privately placed with Life Insurance Corporation of India)

0.000

333.300

International Finance Corporation, Washington - A Loan US $ 100 million equivalent*

0.000

5072.000

International Finance Corporation, Washington - B Loan US $ 300 million equivalent*

0.000

15216.000

Term Loan from State Bank of India

4537.600

0.000

Cash Credit/Packing Credit from Banks

 

 

(i) State Bank of India

0.000

0.000

(ii) Others

Borrowing from State Bank of India and Other Banks under items g(i) and g (ii) above are secured

by hypothecation of stocks, stores and book debts, ranking in priority to the floating charge under items (a) to (e) hereof.

0.000

900.000

Government of India

 

 

(i) for constructing a hostel for trainees at Jamshedpur

0.100

0.100

(ii) for setting up a dispensary and a clinic at Collieries Secured respectively by a first mortage on the lands together with the buildings for hostel and dispensary and clinic constructed thereon.

0.100

0.100

Total

22593.200

39130.500

 

 

* Repayable in foreign currency

Loan from the Joint Plant Committee-Steel Development Fund [item (a) above] is secured by mortgages, ranking pari passu inter se, on all present and future fixed assets, excluding land and buildings mortgaged in favour of Government of India under item (h) hereof, land and buildings, plant and machinery and movables of the Tubes Division and the Bearings Division mortgaged in favour of the financial institutions and banks, assets of the Ferro Alloys Plant at Bamnipal mortgaged in favour of State Bank of India and assets of Cold Rolling

Complex (West) at Tarapur and a floating charge on other properties and assets (excluding investments) of the Company, subject to the Prior floating charge in favour of State Bank of India and other banks under items g (i) and g(ii) hereof.

 

Loan from the Joint Plant Committee-Steel Development Fund included in item (a) above is not secured by charge on movable assets of the Company and includes Rs. 12025.400 millions (31.03.2009: Rs. 10534.500 millions) representing repayments and interest on earlier loans for which applications of funding are awaiting sanction.

 

On amalgamation of Hooghly Met Coke and Power Company Limited (HMPCL) with the Company, the term loan from State Bank of India and others availed by erstwhile HMPCL [Item (f) above] is secured by a first charge on the entire fixed assets (including mortgage over the immovable properties) of erstwhile HMPCL, ranking pari passu with the other term lenders. The term loan is also secured by a first charge on receivables from sale of Hot Flue gases, pari passu with other term lenders and second charge on the current assets comprising of stocks, receivables etc. of HMPCL (other than power receivables on which the term lenders have an exclusive charge).

 

Unsecured Loans

31.03.2010 (Rs. In Millions)

31.03.2009 (Rs. In Millions)

Fixed Deposits

9.400

42.400

Housing Development Finance Corporation Limited

12.000

30.300

Privately Placed Non-convertible Debentures

54009.000

32500.000

Japan Bank for International Cooperation and various Financial Institutions*

0.000

874.800

JPY Syndicated ECB Loan – US $ 495 million equivalent*

28201.500

30285.500

JPY Syndicated Standard Chartered Bank Loan – US $ 750 million equivalent*

43017.900

46196.800

Standard Chartered Bank Loan – GBP 30 million*

2046.700

0.000

Canara Bank, London ECB Loan US $ 5 million equivalent*

224.600

253.600

Euro Hermes Loan from Deutsche Bank, Frankfurt*

444.4000

393.200

Euro Sace Loan from Deutsche Bank, Frankfurt*

2564.500

2611.200

1% Convertible Alternative Reference Securities*

21168.300

54739.200

4.50% Foreign Currency Convertible Bonds (2014)*

24572.400

0.000

Term loan from IDBI Bank Limited

0.000

11000.000

Term loan from SBI

35000.000

25000.000

Term loan from Axis Bank

10000.000

20000.000

Term loan from HDFC

6500.000

0.000

Term loan from IDFC

1990.000

0.000

Buyers' credit *

0.000

6399.800

Interest free loans under Sales Tax Deferral Scheme

38.100

4.500

Total

229798.800

230331.300

 

Note : Amounts repayable within one year Rs. 16042.000 millions (31.03.2009 : Rs. 18112.500 millions).

* Repayable in foreign currency.

 

 

Banking Relations :

--

 

 

Auditors :

 

 Name:

 Deloitte Haskions and Sells

Chartered Accounts

 

 

Associates :

·         Tata Tele-services Limited

·         Nicco Jubilee Park Limited

·         Jamshedpur Injection Powder Limited

·         Kalinga Aquatics Limited

·         Adityapur Toll Bridge Limited

·         Tinplate Company of India Limited

·         TRF Limited

·         Tata Yodogawa Limited

·         Tata Sponge Iron Limited

·         Metaljunction.com Private Limited

·        Tata Ryerson Limited

·         Tata Construction and Projects Limited

·         Rujuvalika Investments Limited

·         Indian Steel Rolling Mills Limited

·         Kumardhubi Fireclay and Silica Works Limited

·         Kumardhubi Metal Casting and Engineering Limited

·         TKM Overseas Limited

·         TKM Transport Management Services Private Limited

·         Almora Magnesite Limited

·         Nilachal Refractories Limited

·         Rallis India Limited

·         Tata Finance Limited

 

 

Subsidiaries
  • Adityapur Toll Bridge Company Limited India
  • Centennial Steel Company Limited* India
  • Gopalpur Special Economic Zone Limited India
  • Jamshedpur Utilities & Services Company Limited India

1.       Haldia Water Management Limited India

2.       Naba Diganta Water Management Limited India

3.       SEZ Adityapur Limited India

  • Kalimati Investment Company Limited India

1.       Bangla Steel & Mining Co. Limited Bangladesh

  • Lanka Special Steels Limited Sri Lanka
  • NatSteel Asia Pte. Limited Singapore

1.       NatSteel Iranian Private Joint Stock Company Iran

2.       NatSteel Middle East FZE UAE

3.       Tata Steel Asia (Hong Kong) Limited Hongkong

4.       Tata Steel Resources Australia Pty. Limited Australia

  • Rawmet Ferrous Industries Limited India
  • Sila Eastern Limited@ Thailand
  • Tata Incorporated USA
  • Tata Korf Engineering Services Limited India
  • Tata Metaliks Limited India

1.       Tata Metaliks Kubota Pipes Limited India

  • Tata Refractories Limited India

1.       TRL Asia Private Limited Singapore

2.       TRL China Limited China

  • Tayo Rolls Limited India
  • Tata Steel (KZN) (Pty) Limited South Africa
  • Tata Steel Holdings Pte. Limited Singapore

a)       NSA Holdings Pte Limited Singapore

b)       Tata Steel Global Holdings Pte Limited Singapore

  • I Corus International (Singapore) Holding Pte. Limited Singapore

1.       Corus Holdings (Thailand) Limited Thailand

2.       Corus International (Guangzhou) Limited China

3.       Corus International (Shanghai) Limited China

4.       Corus Metals (Malaysia) Sdn. Bhd. Malaysi

5.       Corus Metals (Thailand) Limited Thailan

6.       Corus South East Asia Pte Limited Singapore

7.       Tata Steel international (Asia) Limited Hongkong

8.       Tata Steel International (Hongkong) Limited Hongkong

 

 

Joint Venture :

·         Tata Steel Limited

1.       Bhubaneshwar Power Private Limited India

2.       mjunction services Limited India

3.       S & T Mining Company Private Limited India

4.       Tata Bluescope Steel Limited India

5.       Tata NYK Shipping Pte Limited Singapore

6.       Tata Steel Processing And Distribution Limited * India

7.       The Dhamra Port Company Limited India

·         Tata Steel Holdings Pte. Limited

a) Tata Steel Global Holdings Pte Limited

I Tata Steel Europe Limited

  1. Afon Tinplate Company Limited UK
  2. Air Products Llanwern Limited UK
  3. B V Ijzerleew Netherlands
  4. Bsr Pipeline Services Limited UK
  5. Caparo Merchant Bar Plc UK
  6. Cindu Chemicals B.V. Netherlands
  7. Corus Celik Ticaret AS Turkey
  8. Corus Cogifer Switches And Crossings Limited UK
  9. Corus Kalpinis Simos Rom SRL. Romania
  10. Danieli Corus Technical Services B.V. Netherlands
  11. Hks Scrap Metals B.V. Netherlands
  12. Ijzerhandel Geertsema Staal B.V. Netherlands
  13. Industrial Rail Services Ijmond B.V. Netherlands
  14. Laura Metaal Holding B.V. Netherlands
  15. Norsk Stal AS Norway
  16. Norsk Stal Tynnplater AS Norway
  17. Ravenscraig Limited UK
  18. Tata Elastron SA Greece
  19. Tata Elastron SA Steel Service Center Greece
  20. Texturing Technology Limited UK

II Tata Steel Global Minerals Holdings Pte. Limited

  1. Riversdale Energy (Mauritius) Limited Mauritius

 

 

Membership :

Confederation of Indian Industry

 

 

Parent Company :

Tata Sons Limited

 

 

CAPITAL STRUCTURE

 

AS ON 31.03.2010

 

Authorised Capital :

No. of Shares

Type

Value

Amount

1750000000

Ordinary Shares

Rs.10/-each

Rs.17500.000 millions

25000000

Cumulative Redeemable Preference Shares

Rs.100/-each

Rs.2500.000 millions

600000000

2% Cumulative Convertible Preference Shares

Rs.100/-each

Rs.60000.000 millions

Total

Rs. 80000.000 millions

 

Issued  Capital :

No. of Shares

Type

Value

Amount

888126020

Ordinary Shares

Rs.10/-each

Rs.8881.300 millions

 

 

 

 

 

 

 Subscribed Capital:

No. of Shares

Type

Value

Amount

887214196

Ordinary Shares

Rs.10/-each

Rs.8872.100 millions

Add

Amount paid up on Ordinary Shares forfeited

Rs.10/- each

Rs. 2.000 Millions

 

Total

 

Rs. 8874.100 Millions


 

Of the 887214196 Ordinary Shares:

 

(a) 95,63,300 shares represent after sub-division 9,56,330 shares (including 9,35,000 shares issued pursuant to the Scheme of Arrangement for the conversion of Deferred Shares into Ordinary Shares and the issue of additional fully paid shares) of the face value of Rs. 75 per share which were issued as fully paid up pursuant to contracts for consideration other than cash. The nominal value of these 9,56,330 shares was increased from Rs. 75 to Rs. 100 each with effect from 1.01.1977.

 

(b) 1,98,12,460 shares represent after sub-division 19,81,246 shares of the face value of Rs. 75 per share which were issued as fully paid bonus shares by utilisation of Rs. 3,81,44,470 from Share Premium Account and Rs. 11,04,48,980 from General Reserve. The nominal value of these 19,81,246 shares was increased from Rs. 75 to Rs. 100 each with effect from 1.01.1977.

 

(c) 5,14,40,270 shares represent after sub-division 51,44,027 Ordinary Shares whose face value was increased during the year 1976-77 from Rs. 75 to Rs. 100 per share by utilisation of Rs. 49,760 from Share Premium Account and Rs.128.550 Millions from General Reserve.

 

(d) 2,05,76,110 shares represent after sub-division 20,57,611 shares of the face value of Rs. 100 per share which were issued as fully paid bonus shares by utilisation of Rs.205.761 Millions from General Reserve.

 

(e) 7,21,530 shares represent after sub-division 72,153 shares of the face value of Rs. 100 per share which were issued as fully paid up to the shareholders of the erstwhile Indian Tube Company Limited on its amalgamation with the Company, for consideration other than cash.

 

(f) 3,30,51,470 shares represent after sub-division 33,05,147 shares of the face value of Rs. 100 per share which were issued as fully paid bonus shares by utilisation of Rs.330.514 Millions from General Reserve.

 

(g) 12,10,003 shares of the face value of Rs. 10 per share were issued as fully paid up to the shareholders of the erstwhile Tata SSL Limited. on its amalgamation with the Company, for consideration other than cash.

 

(h) 18,44,90,952 shares of face value of Rs. 10 per share were issued as fully paid bonus shares by utilisation of Rs. 1,844.909 Millions from Securities Premium Account during the year 2004-05.

 

(i) 2,70,00,000 shares of face value of Rs. 10 per share issued to Tata Sons Limited on a preferential basis during the year 2006-07.

 

(j) 2,85,00,000 shares of face value of Rs. 10 per share allotted to Tata Sons Limited on a preferential basis during the year 2007-08.

 

(k) 12,16,11,464 shares of face value of Rs. 10 per share allotted at a premium of Rs. 290 per share to the shareholders on Rights basis during the year 2007-08.

 

(l) 8,151 shares of face value of Rs. 10 per share allotted on Rights basis at a premium of Rs. 290 per share during 2008-09 to the shareholders whose shares were kept in abeyance in the Rights issue made in 2007, leaving a balance of 1,74,956 shares being kept in abeyance.

 

(m) 9,12,11,001 shares of face value of Rs. 10 per share allotted at a premium of Rs. 590 per share to holders of CCPS in the ratio of 6:1 on 01.09.2009, on conversion.

 

(n) 135 shares of face value of Rs. 10 per share allotted on rights basis at a premium of Rs. 290 per share during 2009-10 to shareholders whose shares were kept in abeyance in the Rights issue made in 2007. Post the conversion of CCPS, total 3,08,063 shares are kept in abeyance.

 

(o) 6,54,10,589 shares of Rs. 10 per share represent the shares underlying GDRs. Each GDR represents one underlying ordinary share. The proceeds of the GDR issue have been utilised in accordance with the purpose as stated in the offer document.

 

After 13.08.2010

 

Authorised Capital : Rs. 83500.000 Millions

 

 

Issued, Subscribed & Paid-up Capital : Rs. 9022.142 Millions


 

FINANCIAL DATA

[all figures are in Rupees Millions]

 

ABRIDGED BALANCE SHEET

 

SOURCES OF FUNDS

 

31.03.2010

31.03.2009

31.03.2008

SHAREHOLDERS FUNDS

 

 

 

1] Share Capital

8874.100

62034.500

62033.000

2] Share Application Money

0.000

0.000

0.000

3] Reserves & Surplus

360743.900

239728.100

210974.300

4] (Accumulated Losses)

0.000

0.000

0.000

NETWORTH

369618.000

301762.600

273007.300

LOAN FUNDS

 

 

 

1] Secured Loans

22593.200

39130.500

35205.800

2] Unsecured Loans

229798.800

230331.300

145011.100

TOTAL BORROWING

252392.000

269461.800

180216.900

DEFERRED TAX LIABILITIES

8676.700

5857.300

6818.000

Provision for employees separation compensation

9571.600

10336.000

10713.000

Foreign currency monetary item translation difference account 

2069.500

0.0000

0.000

 

 

 

 

TOTAL

642327.800

587417.700

470755.200

 

 

 

 

APPLICATION OF FUNDS

 

 

 

 

 

 

 

FIXED ASSETS [Net Block]

160060.300

144822.200

126235.600

Capital work-in-progress

0.000

0.000

0.000

 

 

 

 

INVESTMENT

449796.700

423717.800

41031.900

DEFERREX TAX ASSETS

0.000

0.000

0.000

Foreign Currency Monetary Item Translation Difference Account 

0.000

 4716.600

0.000

 

 

 

 

CURRENT ASSETS, LOANS & ADVANCES

 

 

 

 

Inventories
24539.900
28682.800
20473.100

 

Sundry Debtors
4348.300
6359.800
5434.800

 

Cash & Bank Balances
32341.400
15906.000
4650.400

 

Other Current Assets
6240.500
6121.900
5578.700

 

Loans & Advances
54996.800
45610.400
333487.400

Total Current Assets
122466.900
102680.900
369624.400

Less : CURRENT LIABILITIES & PROVISIONS
 

 

 

 

Sundry Creditors

40866.500
38427.900
 

 

Other Current Liabilities
25664.400
21970.700
38552.600

 

Provisions
23465.200
29171.900
29135.200

Total Current Liabilities
89996.100
89570.500
67687.800

Net Current Assets
32470.800
13110.400
301936.600

 

 

 

 

MISCELLANEOUS EXPENSES

0.000

1050.700

1551.100

 

 

 

 

TOTAL

642327.800

587417.700

470755.200

 

PROFIT & LOSS ACCOUNT

 

 

PARTICULARS

31.03.2010

31.03.2009

31.03.2008

 

SALES

 

 

 

 

 

Income

250219.800

243157.700

196910.300

 

 

Other Income

8537.900

3082.700

2428.000

 

 

TOTAL                                     (A)

258757.700

246240.400

199338.300

 

 

 

 

 

Less

EXPENSES

 

 

 

 

 

Manufacturing and Other Expenses

163960.000

155259.900

118527.500

 

 

Expenditure (Other than Interest) Transferred to Capital and other accounts

(3261.100)

(3436.500)

(1755.000)

 

 

Exceptional Item

0.000

0.000

(4308.900)

 

 

TOTAL                                     (B)

160698.900

151823.400

112463.600

 

 

 

 

 

Less

PROFIT BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B)      (C)

98058.800

94417.000

86874.700

 

 

 

 

 

Less

FINANCIAL EXPENSES                         (D)

15084.000

11526.900

7865.000

 

 

 

 

 

 

PROFIT BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D)                                       (E)

82974.800

82890.100

79009.700

 

 

 

 

 

Less/ Add

DEPRECIATION/ AMORTISATION                     (F)

10831.800

9734.000

8346.100

 

 

 

 

 

 

PROFIT BEFORE TAX (E-F)                               (G)

72143.000

73156.100

70663.600

 

 

 

 

 

Less

TAX                                                                  (I)

21675.000

21138.700

23793.300

 

 

 

 

 

 

PROFIT AFTER TAX (G-I)                                  (J)

50468.000

52017.400

46870.300

 

 

 

 

 

Add

PREVIOUS YEARS’ BALANCE BROUGHT FORWARD

94967.000

63874.600

 

 

 

 

 

 

Balance brought forward – hooghly met coke and power company limited on amalgamation

122.800

0.000

 

 

 

 

 

 

Less

APPROPRIATIONS

 

 

 

 

 

Proposed Dividends

7097.700

11689.500

NA

 

 

Dividend on Cumulative Convertible Preference Shares

458.800

1094.500

 

 

 

Tax on Dividends

1228.000

2141.000

 

 

 

General Reserve

5046.800

6000.000

 

 

 

Debenture Redemption Reserve

4000.000

0.000

 

 

BALANCE CARRIED TO THE B/S

127726.500

94967.000

 

 

 

 

 

 

 

IMPORTS

 

 

 

 

 

Raw Materials

31025.700

41467.500

15427.900

 

 

Semi-Finished Products

53.800

280.200

164.400

 

 

Components, Stores and Spare Parts

2618.800

2884.200

2331.800

 

 

Capital Goods

6727.100

5422.800

4332.300

 

TOTAL IMPORTS

40425.400

50054.700

22256.400

 

 

 

 

 

 

Earnings Per Share (Rs.)

 

 

 

 

- Basic

60.26

69.45

66.80

 

- Diluted

57.31

62.94

NA

 

 

QUARTERLY RESULTS

 

PARTICULARS

 

 

30.06.2010 (1st Quarter)

30.09.2010 (2nd Quarter)

Net Sales

 

65514.800

71067.500

Total Expenditure

 

36350.300

44777.300

PBIDT (Excl OI)

 

29164.500

26290.200

Other Income

 

484.300

7326.700

Operating Profit

 

29648.800

33616.900

Interest

 

3276.800

3424.800

PBDT

 

26372.000

30192.100

Depreciation

 

2802.000

2814.600

Profit Before Tax

 

23570.000

27377.500

Tax

 

7776.100

6726.200

Profit After Tax

 

15793.900

20651.300

Net Profit

 

15793.900

20651.300

 

 

 

KEY RATIOS

 

 

PARTICULARS

 

 

31.03.2010

31.03.2009

31.03.2008

PAT / Total Income

(%)

19.50

21.12

23.51

 

 

 

 

 

Net Profit Margin

(PBT/Sales)

(%)

28.83

30.08

35.89

 

 

 

 

 

Return on Total Assets

(PBT/Total Assets}

(%)

25.53

29.54

14.25

 

 

 

 

 

Return on Investment (ROI)

(PBT/Networth)

 

0.20

0.24

0.26

 

 

 

 

 

Debt Equity Ratio

(Total Liability/Networth)

 

0.93

0.30

0.25

 

 

 

 

 

Current Ratio

(Current Asset/Current Liability)

 

1.36

1.15

5.46

 

 

LOCAL AGENCY FURTHER INFORMATION

 

HISTORY          

 

Subject is the world's 6th largest steel company. It is a Asia's 1st and as well as India's largest integrated steel company in private sector with operations in 24 countries and commercial presence in over 50 countries. The company's history is a century old, the origins and ascent of Tata Steel, which has culminated into the century long history of an industrial empire, emerge from the illustrious efforts of India's original iron man and the remarkable people who thereafter, have kept the fire burning. Tata Steel was founded by Jamsetji Nusserwanji Tata in the year 1907 as Tata Iron and Steel Company (TISCO) and later its renamed to Subject. It is an ISO-14001 and also SA 8000 certified company, is this reflected in company's pro-active measures to ensure optimum utilization of natural resources and work conditions.


The company focused on Steel Division, apart from the main Steel Division, Tata Steel's operations are grouped under six Strategic Business Units include Bearings Division, Ferro Alloys and Minerals Division, Agrico Division, Tata Growth Shop (TGS), Tubes Division and Wire Division. Tata Steel is a global player with a balanced presence in developed European and fast growing Asian markets and with a strong position in the construction, automotive and packaging markets. Its Jamshedpur steel works produces hot and cold rolled coils and sheets, galvanised sheets, tubes, wire rods, construction rebars, rings and bearings. In an attempt to 'decommoditise' steel, the Company has introduced several branded steel products, including Tata Steelium (the world's first branded Cold Rolled Steel), Tata Shaktee (Galvanised Corrugated Sheets), Tata Tiscon (rebars), Tata Pipes, Tata Bearings, Tata Structural, Tata Agrico (hand tools and implements) and Tata Wiron (galvanised wire products).  
 
Tata Steel's first ingot of steel was rolled out in February 1912 and the Greater Extension Scheme was launched in 1916 to raise capacity to 4,50,000 tonnes for diversify production. The New Rail Mill, Merchant Mill and Sheet Mill went into operation in the year of 1925. A historic agreement was signed between Netaji Subhas Chandra Bose and the company in 1928 on saga of mutual cooperation and understanding that was being nurtured and developed at Tata Steel and continues to this day. The Profit Sharing Bonus was granted for the first time in India by the company in the year of 1934. 'A' Furnace was 'blown-in' into operation on 1939. The period of one year between 1942 and 1943, was characterized by the efforts of the Steel Company to produce a wide variety of special steels required for defense purposes including armoured cars called 'Tatanagars'. Tata Steel's took step towards nation building was in 1943 with the construction of Howrah Bridge. The Two Million Expansion plan was undertaken between the years of 1953-54. The Ferro Manganese Plant commenced production at Joda in April, 1967. Tata Steel was the first institutions in India to have gone for total computerization as part of a modernisation process in the same year 1967 through IBM.

 
Golden Jubilee of the company was celebrated in the year 1958 and Jubilee Park was given as a gift to the citizens of Jamshedpur. For symbol of self-reliance, Tata Steel Growth Shop which was introduced in 1968. Tata Steel introduced BOF steelmaking during the year 1984, which could produce liquid steel in forty five minutes when it took the old open hearth furnaces, close to five hundred under the first phase of modernisation. As part of social responsibility the Tata Steel Rural Development Society (TSRDS) was established in 1979 to assist villages around Jamshedpur in different ways. The second phase of modernisation was in the year 1988, it concentrated largely on the iron-making area. Lifeline Express, the world's first hospital-on-wheels sponsored by Tata Steel was started in 1991. During the third phase of modernisation in 1994, the company set up an internationally competitive flat products complex. Apart from a one million tonne hot strip mill, a new one million tonne G blast furnace was also installed. Tata Steel became the First Steel Plant in India to be ISO - 14001 Certified.  
 
The company received the Award for Best-Integrated Steel Plant in 1994-95. The company also received the Prime Minister's Trophy for the Best Integrated Steel Plant for the year 1994-95. This award was subsequently conferred again in 1998-99, 1999-2000, 2000-01 and 2001-02. The World Steel Dynamics recognised Tata Steel as India's only 'world-class steel makers' thrice in a row. Cold Rolling Mill Complex in 2000. The final phase of modernisation was to bring about productivity enhancement through the expansion of the Hot Strip Mill from one million tonnes per annum to a two million capacity. The company's 75 years of industrial harmony was celebrated on 2004 with His Excellency, Dr. A P J Abdul Kalam,Former President of India. It signed Memorandums of Understanding (MoUs) with the Sate Governments for its Green field Projects in Kalinganagar (Orissa) and in Bastar District (Chhattisgarh) on 2004. Subject signed four MoU's with the Government of Jharkhand not only for the Greenfield Project but also the enhancement of capacity of Jamshedpur Works. The current capacity of Works in Jamshedpur is 5 Million Tonne. 


Tata Steel's first step in the Global Market was when it acquired the steel business of NatSteel Limited, Singapore. It also signed a joint venture BlueScope Steel Limited, Australia in 2005, for setting up a metallic coating and painting unit. To boost the economy of South Africa and also add significantly to the Indian economy, Tata Steel commenced the work on Ferro Chrome Plant in 2006 by acquired Rawnet Ferrous Industries Private Limited, in Orissa, a Ferro Alloys plant with a capacity of 50,000 tpa of high carbon chrome. The company has set up a Joint Venture Company with Larsen and Toubro Limited for developing an all weather modern deep water port in the state of Orissa on the Eastern Coast of India Tata NYK Shipping Pte. Limited, a joint venture shipping company between the company and Nippon Yusen Kabushiki Kaisha (NYK Line) has been set up to cater to dry and break bulk cargo and also the shipping activities. Tata Steel is one of the few steel companies in the world that is Economic Value Added (EVA) positive. It was ranked the 'World's Best Steel Maker', for the third time by World Steel Dynamics in its annual listing in February, 2006. Tata Steel has been conferred the Prime Minister of India's Trophy for the Best Integrated Steel Plant five times. On 2nd April '07, Tata Steel acquired Corus Europe's second largest steel producer for consideration of US$ 12 Billion, which made Tata Steel the sixth largest steel producer globally and the second-most geographically diversified steel producer in the world. It also entered into an agreement to acquire controlling equity stake in two rolling mills located in Haiphorg, Vietnam. It signed MoU and MoC for an investment in a 4.5 million tonnes per annum plant in Vietnam. The company and SODEMI (state owned company for mineral development) entered into Joint Venture agreement for the development of Mount Nimba Iron ore deposits in Ivory Coast (West Africa) on December 2007. 


As on January 2008, Subject and the members of the Al Bahja Group, a leading business house of Oman have entered into a Joint Venture Agreement for the development of the Uyun Limestone deposits at Salalah in the Sultanate of Oman and also in same month and in the same year the company came to agreement with Steel Authority of India Limited (SAIL) to establish a 50:50 joint venture company for coal mining in India. The fourth retail outlet, 'steeljunction', at Behala was opened on February 2008 by the company. As of September 2008, the company have 42.3% satke in Australia based Riversdale Mining, resulted the bought of 7.29% in Septeber 2008 for $120.7 million through its Singapore subsidiary. The company plans to expand its of Jamshedpur plant's crude steel making capacity from 5 million tonnes to 6.8 million tonnes with cost of Rs.45500 millions and also the company plans to set up a 6 million tonne integrated steel project at Kalinganagar in the state of Orissa under two phases of 3 million each.

 

The values and principles which have governed Tata Steel’s business for a century, have been deployed through the implementation of the Tata Code of Conduct (TCOC). This process of implementation of TCOC among stakeholders is known as the Management of Business Ethics (MBE), which is deployed effectively in the Company through its ‘Four Pillars’ concept, which are:

  • Leadership
  • Systems and Processes
  • Training and Awareness
  • Measurement

 

The year 2008-09 was marked by the launch of the Tata Code of Conduct 2008. The Code has the flavour of globalization and gender sensitivity, which reflected the presence of the Tata Group’s footprints in many foreign countries. The revision of the Code included the following points keeping globalisation in mind:

  • International nuances were added (originally perceived as India-centric was modified and the Code was made global).
  • Gender bias was removed.
  • An additional global focus area was incorporated, e.g. culture sensitivity, colluding to bribe, right to privacy, improving environment-greenhouse gases, preserving human rights, honouring commitments.
  • Employee responsibility has been inserted under relevant clauses.
  • Third party accountability has been added by obtaining Non Disclosure Agreements by the Tata Company with third parties and their employees.

 

Tata Steel took various steps to roll out the Code within the Company. The leadership team and all executives reconfirmed their dedication to the Code by an online acceptance of compliance through the SAPHR Portal. The changes in the new Code were made known to all by circulating two codes per week through Lotus Notes, which is the internal mailing system of the Company. This system has helped people within the organisation understand the Code better.

 

In addition to this, other initiatives were also taken to deploy the Code throughout the Company. These include printing of books, posters of the Code in English, Hindi and other regional languages which also carried the Managing Director’s message. Posters were put up at strategic locations to help all employees to familiarise themselves with the Code. There were also several classroom training sessions and shop floor discussions. The Code has also been uploaded on the Company’s website.

 

All partners including vendors, contractors and other agencies, were informed about the new Code through the e- Procurement and online business sites. Their non disclosure agreements were also taken online.

 

In order to make the Company’s ‘Whistle Blower Policy’ effective and to encourage more whistle blowers, the ‘Whistle Blower Reward Policy’ was incorporated. In addition to this, a film on a whistle blower’s role was also made and screened across all levels of the Company. The Ethics Group of the Company was also subject to the Deming examinations this year and this has helped the function improve the monitoring of its processes.

 

GLOBAL ECONOMY

 

2009 was one of the most challenging years for the global economy in recent times with the global recession of 2008 and 2009 representing the largest peacetime downturn in economic activity since the 1930s. The World Bank reported that the positive growth in the emerging and developing economies was more than offset by negative growth in the advanced economies resulting in negative World GDP growth in 2009. The sharp decline in global demand for consumer durables and investment goods that accompanied the economic crisis, led to a significant demand contraction particularly in the United States of America and Europe which continued in most economies till September 2009. Economies with large current account deficits, excessive reliance on foreign capital to finance domestic consumption, and sizeable fiscal deficits witnessed sharper growth declines. Following unprecedented fiscal and monetary policy stimulus measures and direct Government support for some institutions and sectors, a gradual recovery in domestic demand and the turning of the inventory cycle saw most economies emerge from recession by the end of 2009. In contrast to most developed and emerging economies, China and India were able to avoid recession and recorded GDP growth of around 10% and 7.2% respectively in spite of a slowdown from pre-crisis growth rates as export demand collapsed across many sectors.

 

The US: The GDP in the country had a negative growth of 2.4% in 2009 over 2008 with a sharp decline in the first quarter of 2009 being partly offset by recoveries in the third and fourth quarters characterised by expanding production but continued job losses. Among the key economic indicators of change in GDP, the gross private domestic investment in 2009 dropped by 23.2% over 2008, while the export of goods and services dropped by 9.6% and 12.2% respectively.

 

The UK and Europe: The Eurozone economy declined by 2.7% in 2009-10 following a contraction of 1.3% in 2008-09 and emerged from recession in the third quarter of calendar year 2009. However, some member countries like Spain, Ireland and Greece continued to remain in recession till the end of calendar year 2009 while the UK emerged from recession in the last quarter of the calendar year. By the end of the downturn, the Eurozone economy as a whole had contracted by 5.1% from the peak and Eurozone industrial production and exports had posted cumulative declines of 14% and 13% respectively. Meanwhile, reflecting a collapse in confidence, tight credit and a large fall in demand, private business investment continued to decline until the end of 2009-10 posting a cumulative decline of 17.2%. The UK Government and the Bank of England undertook measures to stimulate the British economy increasing the liquidity and easing access for large companies to credit. However, this was not sufficient to support medium and small businesses resulting in a drop in industrial production and private business investment.

 

India: In India, the Economic Survey of 2009-10 revealed that some of the key macroeconomic indicators revived especially during the second half of the year compared to the previous year. Even though the agricultural output declined by 0.2% as a consequence of a poor monsoon season, the industrial and service sectors grew at the rate of 8.2% and 8.7% respectively taking estimated GDP growth to 7.2% during the year. It is worth noting that the manufacturing industry grew at 8.9% during the year.

 

TATA STEEL GROUP PERFORMANCE

Global effective steelmaking capacity utilisation fell sharply in the second half of 2008 as steelmakers cut production in response to falling demand, reaching a low of around 61% in December 2008 - a fi gure which had improved to 76% by December 2009. Capacity utilisation at Tata Steel Europe improved to 81% in the second half of 2009-10 in comparison to 64% in the first half of the financial year resulting in a 16% rise in production in H2FY 10 over H1FY 10. Group deliveries for the year 2009-10 at 24 million tones declined 15% compared to the 28 million tonnes recorded during 2008-09 as recessionary conditions affected most economies though less so in India. Tata Steel India registered growth of 18% in the financial year 2009-10 (6.17 million tonnes) over 2008-09

(5.23 million tonnes).

 

The Turnover for the Group in 2009-10 at Rs. 1023930.000 millions, was 30.5% lower than 2008-09 (Rs. 1473290.000 millions) due to the severe contraction in the end user demand in Europe. The spot price of steel continued to be weak in the first half of 2009-10, with marginal recovery during the second half in line with the gradual pickup in global steel demand. The price recovery has varied by product and region, but in general has been strongest for Strip products in Asia while Long Product prices continued to be under pressure in Europe and Thailand due to lower level of construction activities in those regions. Consequently the Tata Steel Group Turnover for the second half of the year was Rs. 537060.000 millions which was 10.3% higher than the first half of 2009-10 at Rs. 486870.000 millions. The increase in the turnover during the second half of the year was primarily due to the significant increase in the deliveries (12.70 million tonnes in the second half compared to 11.57 million tonnes in the first half of 2009-10) and increase in the average prices during the second half of the year. For the year, Tata Steel Europe’s Turnover at Rs. 671920.000 millions was 39% lower than that of last year.

The Earnings before Interest, Taxes, Depreciation and Amortisation (EBITDA) of the Group was significantly affected in the first half of the financial year 2009-10 by the sudden termination of the Teesside Offtake Agreement by the Consortium members and the challenging market conditions in the Europe. This resulted in a consolidated EBITDA for the Group of Rs. 6060.000 millions for the six months ended September 2009. However, with the help of several initiatives across the Group and the re-structuring program in Europe, the Company reported a significant turnaround in the financial performance of the Company in the second half of the year with a consolidated EBITDA of Rs. 87340.000 millions which was 1341% higher than the fi rst half of the year. The consolidated EBITDA for the year 2009-10 was Rs. 93400.000 millions compared to Rs. 184950.000 millions in the corresponding period of the previous year.

 

Consequently, the Profit After Tax for the second half of the year 2009-10 was Rs. 29070.000 millions compared to a loss of Rs. 49160.000 millions in the first half of the year. This resulted in a loss after tax (after minority interest and share of profit of associates) of Rs. 20090.000 millions for the year which was significantly lower compared to the profi t of Rs. 49510.000 millions registered in FY 2008-09.

 

Tata Steel – Indian operations: The steel division of the Indian operations registered an increase of 20% in their saleable steel from 5.37 million tonnes in FY 2008-09 to 6.44 million tones in FY 2009-10. The production from the larger furnaces were maximised with better productivity and lower coke consumption while increased vessel life in the steel melting area enhanced the production level. The deliveries during the year FY 2009-10 at 6.17 million tonnes were higher by 18% over FY 2008-09 (5.23 million tonnes). There were several best ever performances recorded by many units in the Steel Works of the Company.

 

The Ferro Alloys and Minerals division registered an increase of 22% in their saleable production during FY 2009-10 (1302k tonnes) over FY 2008-09 (1064k tonnes) while their sales at 1,508k tonnes in the year were higher by 36% over FY 2008-09(1,105k tonnes). Chrome Alloys exports and Manganese Alloys sales of the

division scaled new peaks during the year. The Tubes division in FY 2009-10 grew by 11% and 10% in production and sales respectively over the previous year, boosted by various improvement initiatives across all its units. The division continues to pioneer the Closed Structural Business, with landmark structures being built using Tata Structura which crossed the three lakh tonnes landmark this year.

 

Sales in the Bearings division registered a growth of 23% while its production increased by 8% driven primarily by the revival in the domestic auto segment demand.

 

Tata Steel Europe (TSE): Deliveries in Tata Steel Europe during FY 2009-10 (14.2 million tonnes) declined by 25% over FY 2008-09 (19 million tonnes) due to the market conditions in Europe and the UK. The recessionary conditions that commenced in the second half of the previous year continued to affect the operations for most part of the financial year 2009-10. The two halves of the financial year were in sharp contrast to each other. The Company acted swiftly to respond to this downturn by launching two very significant initiatives i.e. ‘Weathering the Storm’ and ‘Fit for the Future’ program. The ‘Weathering the Storm’ program covering the entire organisation in Europe, included a series of short-term actions to mitigate the impact of reduced steel

demand. It involved a reduction in third party services, flexible production to reduce energy cost, reduction in employment cost relating to overtime and putting major capital expenditure programmes on hold. The ‘Fit for the Future’ initiatives were put in place to address longer term issues such as TSE’s competitiveness and targeted savings of Ł350m. The performance of the Company was adversely affected by the sudden termination in April 2009 of the Long-term Off-take Agreement by the Consortium for the slabs produced by Teesside Cast Products business in the UK thus burdening the Company with exposure to the small, niche merchant slab market. The Company did operate the Teesside plant till February 2010 incurring significant losses as the slabs are surplus to the requirements of the Company. Therefore, the Company had to regrettably mothball part of the facilities in February 2010 including the Redcar blast furnace and Lacken by steelmaking. The Company continues to explore options that could provide employment for the employees affected, including the sale of the mothballed operations. The Company registered a significant turnaround in its operations in the second half of the year. This was achieved through increased deliveries, better cost structure and improved pricing scenario. Therefore, the EBITDA for the second half of the year was Rs. 23030.000 millions which was around 163% more than the negative EBITDA of Rs. 36540.000 millions in the first half.

 

NatSteel Holdings:

NatSteel recorded an increase in sales by 3% in FY 2009-10 (2.44 million tonnes) over FY 2008-09 (2.37 million

tonnes). The increases were mainly in the subsidiaries in China, Vietnam and Thailand while the Singapore operations and other subsidiaries witnessed a dip in the sales volume over last year due to lower construction activity in the region especially in the first half of the year. The Chinese subsidiary contributed the most (FY 2009-10 0.532 million tonnes) with an increase of 25% in volumes over the prior year. In Vietnam, construction demand led to an increase in steel demand resulting in sales of NatSteel Vina to be at 0.13 million tonnes in FY 2009-10, 65% higher than the previous year. In Thailand the deliveries at 0.152 million tones witnessed a growth of 20% over 2008-09. The profit after tax for NatSteel Holdings was at Rs. 1020.000 millions in FY 2009-10 as compared to Rs. 70.000 millions in the financial year 2008-09.

 

Tata Steel Thailand (TSTH):

TSTH recorded an increase of 8% in sales during FY 2009-10 (1.20 million tonnes) over FY 2008-09 (1.11 million tonnes) with increases of 6% and 9% in the domestic sales and exports respectively. The Mini Blast Furnace along with its ancillary facilities was commissioned during the year. However, poor prices prevailing in the market along with higher input costs led to a loss for the company (Rs. 110.000 millions) during FY 2009-10 as compared to a profit of Rs. 110.000 millions in FY 2008-09.

 

EXPANSION PROJECTS

 

Brownfi eld Projects:

Tata Steel India is executing its plan to increase its crude steel capacity from 6.8 million tonnes per annum to 9.7 million tones per annum at its Jamshedpur Works by 2011-12. Simultaneously the Company also has a few major ongoing capital projects which includes the capacity augmentation of Hot Strip Mill, Coke Dry Quenching at Coke Ovens Batteries 5, 6 and 7 and setting up a new mill for producing Full Hard Cold Rolled (FHCR) coils at Jamshedpur.

 

On 06.04.2010, Tata Steel entered into a Memorandum of Understanding with Nippon Steel Corporation (NSC), Japan for setting up a Continuous Annealing and Processing Line at Jamshedpur, India with 0.6 mtpa capacity. The line will produce automotive cold rolled fl at products and address the local needs of Indian automotive customers for high grade cold rolled steel sheets. Tata Steel will hold 51% and NSC will hold 49% stake in the joint venture company. The proposed joint venture aims to capture the growing demand for high-grade automotive cold-rolled flat products in India. NSC will transfer its technology for producing high-grade cold-rolled steel sheets for automotive application including skin panel and high tensile steel. These projects, along with other sustenance and improvement projects are being implemented with a view to support the Company’s current operations and its growth aspirations.

 

Greenfi eld Projects:

Orissa Project: Preliminary work on the 6 million tonne per annum capacity greenfield steel plant at Kalinganagar, Orissa to be constructed in two phases, is in progress, focusing on land acquisition, rehabilitation and resettlement work. As of March 2010, a total of 806 families have been shifted from the plant site. The rehabilitation colonies for their resettlement have been provided with good infrastructural facilities which include clean drinking water, street lighting, and a community centre set up by the Company. A hospital with all amenities is also being provided by the Company. During the financial year 2009-10, construction of a warehousing shed and a building for a power receiving sub-station had started at one corner of the plant area.

 

As per the MOU signed with the State Government of Orissa, the Company has fulfi lled its obligation of placing the order for equipment and services.

 

Chhattisgarh Project: The Company has signed an MOU with the Government of Chhattisgarh for setting up of a 5 mtpa greenfi eld integrated steel plant in Bastar. The process of land acquisition commenced with multi level discussions with stakeholders and thereafter obtaining necessary approval for a rehabilitation and resettlement package from the government. The land has been transferred in favour of the Department of Industries, which will

subsequently lease it out to Subject. The Chhattisgarh Government has accorded approval for drawing

water from river Sabri and the Ministry of Railway, Government of India has granted an in principle approval for the railway corridor. Prospecting License for iron ore has been granted in Bailadila-I deposits after approvals have been obtained from the Ministry of Environment and Forest and Ministry of Mines, Government of India. Public hearing for the Environment clearance has been successfully conducted with the State Government having recommended the Company case to the Ministry of Environment and Forest, New Delhi. In line with the Company’s initiatives in the field of Corporate Social Responsibility, several activities in the field of health, youth

and women empowerment, sports and skill development are being carried out for the local residents as well as those of the displaced families.

 

RAW MATERIAL PROJECTS

The Company continued to implement its long-term strategy to secure ownership of assets that will increase its raw materials security and share of value-added products. During the financial year 2009-10 the Company’s primary focus was on expediting implementation of its existing ventures.

 

Coal Projects:

Benga Coal Project, Mozambique: The Tata-Riversdale Joint Venture (JV) in Mozambique conducted a formal ‘Ground Breaking Ceremony’ at the Benga Coal Project in the presence of the President of the Republic of Mozambique, His Excellency Armando Emilio Guebuza on 14.04.2010. This offi cial ceremony follows a series of milestones already achieved by the Company such as the signing of the Mining Contract, approval of Environmental Licenses for the Benga Coal Project and the Benga Power Project and the approval of Stage 1 of the Benga Coal Project following the completion of the Feasibility Study for production of 10.6 million ROM tonnes in two phases. Other key contracts and agreements include the CHP Plant Supply Contract, a Resettlement Action Plan, and the Project Labour Agreement (PLA) which was signed with SINTICIM (the Mozambican National Construction and Mineworkers Union). Stage 1, entails initial production of 5.3 million ROM tonnes per year to produce approximately 1.7 mtpa of high quality hard coking coal and 0.3 mtpa of export thermal coal by Q2 2011. Tata Steel has a 35% stake in the JV with a 40% off-take right to the coking coal produced from these mines. The JV owns the Benga and Tete tenements which cover an area of 24,960 hectares. Benga has an inferred resource of approximately 4 billion tonnes. The Company plans to supply the hard coking coal from this project to its facilities in Europe in the initial phase of the project development and also for the requirements of the Indian operations in the future. Tata Steel currently holds about a 21.14% equity stake in the parent company, Riversdale Mining Limited.

 

Coal Mining Project in Australia (CDJV): Tata Steel has a strategic interest of 5% in the coal mining project in Australia in partnership with Vale, Nippon Steel, JFE and POSCO with up to 20% off-take rights. The Joint Venture was formed for the development of a Greenfield underground coal project in

Bowen Basin, Queensland. The first raw coal production started in August 2006 and the mine is currently producing around 1 mtpa. The Longwall expansion programme continued during the year. On completion of the second phase, it is expected to produce around 2.5 million tonnes of Coking and PCI coal during the fiscal year 2010-11.

 

Iron Ore Projects:

Direct Shipping Ore Project in Canada (New Millennium

Capital Corp.):

In September 2008, Tata Steel had entered into a Heads of Agreement with New Millenium Capital Corporation, Canada (NML), a Canadian listed mining company, to develop iron ore projects in northern Quebec and Newfoundland and Labrador and had acquired a 19.9% stake in NML. Tata Steel has an exclusive option to acquire an 80% equity interest in NML’s Direct Shipping Ore project (DSO Project), a commitment to take the resulting production if the option is exercised and an exclusive right to negotiate and settle a proposed transaction in respect of NML’s LabMag and KeMag Projects.

 

In November 2009, Tata Steel signed a Joint Venture Agreement with NML, to advance the development of the DSO Project. In June 2010, Tata Steel subscribed to a private placement of Canadian $20 million by NML pursuant to which Tata Steel Global Minerals Holding Pte. Limited now holds a 27.4% stake in NML. NML has completed a feasibility study for the DSO Project which is being reviewed by Tata Steel. The Feasibility Study estimates proven and probable mineral reserves of 64.1 million tonnes for the DSO Project. Subject to receiving all regulatory approvals, production is expected to commence in 2011. Tata Steel will have 100% offtake rights to the produce of the mine of a specifi ed quality. The iron ore from this project will be supplied to Tata Steel Group’s

facilities located in Europe.

 

Ivory Coast Project: In view of the environmental issues encountered in the case of Mt. Nimba, Tata Steel approached the Government of Ivory Coast to grant a prospecting license for Mt. Gao for an early start of the project. The Government of Ivory Coast has granted an exploration license to Sodemi on 30th July, 2009 and an Addendum to the Joint Venture Agreement was signed on 29.09.2009 to include Mt. Gao in the Joint Venture Agreement. The exploration license for Mt. Gao has been transferred to the JV Company. A team has been deployed on the ground to carry out the feasibility studies.

 

Limestone Project:

Limestone Project in Oman: The Environmental Impact Assessment has been completed and the mining license is awaited.

 

OTHER PROJECTS

Hooghly Met Coke and Power Company Limited. (HMPCL): As a part of business restructuring exercise, Tata Steel merged Hooghly Met Coke and Power Company Limited. (HMPCL) with itself with effect from 01.04.2009. The scheme became effective on 24.03.2010 after sanction of the scheme of merger by Honorable High Court of Kolkata. HMPCL was incorporated in 2005 and was a 100% subsidiary of Tata Steel prior to merger. The company was set up to produce low ash metallurgical coke by adopting the heat recovery route and for meeting Tata Steel’s requirements for its Jamshedpur plant. The plant is located in Haldia, West Bengal. Close proximity to the Haldia Dock Complex offers several advantages, including the import of coking coal in a more cost effective manner. The company has a production capacity of 1.6 million tonnes of coke.

 

Dhamra Port Company Limited (DPCL):

The Dhamra Port Company Limited, a 50:50 joint venture of Subject and Larsen and Toubro, is developing a deep-draught port under a concession agreement awarded by the Government of Orissa on Build, Own, Operate, Share and Transfer (BOOST) basis. Situated between Haldia and Paradip, Dhamra Port will be one of the deepest ports in India with a draft of 18 meters, capable of accommodating super capesize vessels up to 1,80,000 DWT. Phase-I of the project is almost complete and the port is expected to commence commercial operations by August 2010. In Phase-I, two fully mechanised berths, one for handling imported cargo and the other for export cargo with back-up facilities are being built, along with a rail corridor for hinterland connectivity. The capacity is estimated to be 27 MTPA in Phase-I. Once commissioned, Dhamra Port will be of strategic importance to Tata Steel in terms of its integrated logistic cost of raw materials and will also consolidate Tata Steel’s supply chain network, contributing to its expansion aspirations.

 

S and T Mining Limited:

As part of the drive to secure raw material sources for domestic operations, Tata Steel formed a 50:50 Joint Venture company, S and T Mining Co. with Steel Authority of India Limited (SAIL) in September, 2008. The company has the specific objective of combining the expertise of its parent companies to identify, acquire and develop coal blocks in India. A number of activities have been initiated towards this objective.

 

MMTC and Tata Steel form a JV for exploration and development of minerals:

Steel production in India is projected to grow to over 120 Million tonnes by the year 2015. To cater to the raw materials requirement of increasing steel demand and other mineral based industries, the Company has entered into an agreement with MMTC Limited, a Central Government undertaking in October 2009 to establish a joint venture company for acquiring, developing and operating mines and processing of minerals and metals. Tata Steel holds 74% equity in the joint venture with MMTC holding 26%.

 

Tata Steel and NMDC sign MoU for enhancing iron ore resources:

Consistent with its long-term strategy to expand its steel capacity in India along with access to enhanced resources, the Company has signed a Memorandum of Understanding (MoU) with NMDC for exploring possibilities of entering into joint ventures for the purpose of acquisition, exploration and development of mines, extraction and processing of minerals, setting up integrated steel plants and any other businesses of mutual interest.

 

MANAGEMENT DISCUSSION AND ANALYSIS:

 

INDUSTRY STRUCTURE

Global Steel industry: The crude steel production for 66 countries reporting to the World Steel Association was 1220 million metric tonnes for calendar year 2009, lower by 8% against that of 2008. Hit by the economic downturn, the drop in production was nearly in all steel producing countries barring positive growth recorded in China, India and the Middle East. In most countries including the developed steel markets of the EU, the U.S.A., Japan, Brazil, CIS deterioration in the economy resulted in a sharp decline of demand in key steel using sectors. The following table shows the growth in terms of crude steel production for the top ten steel producing nations.

 

As a result of the strong growth in China in sharp contrast to the decline in major parts of the globe, the list of the top ten steel producing companies during 2009 was dominated by Chinese companies.

 

Steel Industry in India:

The production of flat products and long products of major Indian companies is estimated to have grown by around 12% and 8% respectively during the financial year 2009-10 when compared with the previous financial year. While the long products exports were almost at the same level as that in the last year, fl at products exports dipped by around 30% on account of the global slowdown. The imports on the other hand were higher for both fl at products as well as long products by around 17% and 35% respectively as the fl at products and long products segments experienced around 23% and 9% increase in steel consumption. In line with the fiscal stimulus package announced in the country, the Government of India removed export duty on all steel items, reintroduced import duty of 5% on steel, restored DEPB benefits, reduced excise duty to 8% for major part of the year, placed import of hot rolled coils on the ‘restricted list’ thus making them available to direct users only and withdrew countervailing duty on import of Thermo-Mechanically Treated (TMT) bars and structural. In order to ensure adequacy of availability of iron ore in domestic market, export duty on iron ore lumps has been increased from 5% to 10% and a 5% export duty has been imposed on iron ore fines to regulate the exports. The steel prices during the financial year 2009-10 have increased from the level prevailing in the quarter ended March 2009 driven primarily by the increase in the prices of input raw materials during the same period.

 

UK and European Steel Industry: In the EU, the apparent steel consumption dropped by around 35% during 2009. There was a decline of around 45% during the first half of 2009 driven by extremely weak activity in the steel using sectors and continuing sharp de-stocking. With the unprecedented drop in the activity levels, the production during 2009 reduced by around 20% over 2008 with sharp reduction experienced particularly during the first half of the year. The market downturn began to level out in the second half of the year as business conditions began to improve slowly, supported by government stimulus measures and improvements in international trade. With imports dropping by around 47% as compared to 2008, stable and low level of stocks through the supply chain and reduced levels of domestic steel business, the EU steel market supply and demand became much better balanced by the quarter ending December 2009. The exports during 2009 are estimated to have reduced by around 9% and the EU was a net exporter in long products.

 

South East Asian Steel Industry: Preliminary assessment suggests that the steel consumption in the Association of South East Asian Nations (ASEAN) picked up significantly in the second half of 2009. However, the increase was not sufficient to offset the sharp drop in the consumption in the first half of the year. As a result, the ASEAN apparent steel demand for 2009 is around 42.3 million tonnes which is 8% lower than the last year. Production of fl at products and long products during the year was stable at around 24.4 million tonnes. However imports and exports dropped significantly. Total imports reduced from 30 million tonnes in 2008 to 19.7 million tonnes in 2009 and exports dropped by 50% from 8 million tonnes in 2008 to 4 million tonnes in 2009.

 

Consumption of Long Products recorded at 20.1 million tones in 2009, reduced by 4% as compared to 2008. The production declined to 16.4 million tonnes while exports dropped to 5.9 million tonnes. The demand for long products seemed to pick up fast and at 11.8 million tonnes in the second half of 2009, was close to the pre-crisis levels resulting in domestic producers benefitting from the demand growth.

 

TATA STEEL GROUP OPERATIONS

During the financial year 2009-10, the Group recorded deliveries of 24 million tonnes against 28 million tonnes in the previous year, the decline being a reflection of the global economic slowdown mainly in the UK and European operations. The turnover for the Group at Rs. 1023930.000 millions during FY 10 was 30.5% lower, when compared to Rs. 1473290.000 millions in the previous year. EBITDA for the Group in FY 10 was Rs. 93400.000 millions, lower by 49.5% against Rs. 184950.000 millions in FY 09. The loss after taxes (after minority interest and share of profit of associates) of Rs. 20090.000 millions during FY 10 registered a decline of 140.5% as compared to a profi t of Rs. 49510.000 millions in FY 09.

 

Tata Steel India

 

1. Steel division

The production and sales figures of the Steel division of the Company are shown in the following table:

 

Figures in million tones

 

FY10

FY09

% Change

Hot metal

7.23

6.25

16

Crude steel

6.56

5.65

16

Saleable steel

6.44

5.37

20

Sales

6.17

5.23

18

 

A trend of steel production and sales is shown below:

 

The major production and sales highlights for the financial year

2009-10 are shown below:

 

Production: Key highlights of the production performances of various units in the Steel Works are shown below:

 

Figures in million tones

 

Best ever

FY10

Previous best

‘G’ Blast Furnace

Hot metal production

2.08

2.04-FY 09

LD shop #2 and slab caster

Slab production

3.70

3.51- FY 09

LD shop #1

Billet production

2.85

2.105-FY 09

Sinter plant

Sinter production

7.66

6.53- FY 09

Solid waste utilization

90%

89.61%

Hot strip mill

Production

3.65

3.27-FY 08

Cold rolling mill

Production

1.563

1.534-FY 08

New bar mill

Production

0.672

0.612-FY 09

Wire rod mill

Production

0.419

0.416-FY 06

Merchant mill

Production

0.341

0.328-FY 09

 

 

'H' Blast Furnace in the first full year of its operation achieved a production of 3.07 million tonnes which was 22% higher than its rated capacity of 2.50 million tonnes. In line with Tata Steel’s expansion plans, the ‘C’ Blast furnace

with a capacity enhancement from 0.4 mtpa to 0.7 mtpa was commissioned in September 2009.

 

The production in the Blast Furnaces was maximised by producing from bigger blast furnaces with higher productivity with significant reduction in coke rate while in the two steel melting shops there was an increase in the vessel life. Driven by the best ever performances at the various units in the Steel Works, Hot metal (7.23 million tonnes), Crude steel (6.56 million tonnes) and Saleable steel (6.44 million tonnes) production reached their individual peak during FY 10.

 

Sales:

• Overall sales at 6.170 million tonnes, grew by 18% over last year (5.232 million tonnes in FY 09).

• Long products sales at 2.697 million tonnes increased by 34% in FY 10 (2.006 million tonnes in FY 09).

• Flat products sales at 3.473 million tonnes increased by 8% in FY 10 (3.226 million tonnes in FY 09).

 

2. Ferro Alloys and Minerals division

The dramatic and rapid slowdown in industrial production and destocking which began in the latter part of FY 09 continued to exert a significant influence over the Ferro Alloy Industry in FY 10. Infrastructural investment in Asia resulted in improvement in the demand for stainless steel. However, despite the improving trend, average commodity prices in FY 10 were significantly lower than that of FY 09. The full benefit of rising prices in the second half of FY 10 was also partially offset by the negative impact of progressive strengthening of the Indian Rupee during the same period. The annual global stainless steel melt production at 24.3 million tonnes in 2009 was lower by 6% than 2008, with prices lower by 44%. However, commencement of re-stocking of stainless steel

globally in the second half of the year led to rise in ferro chrome demand and prices in that period. Chrome Alloys exports (including Charge chrome from Tata Steel KZN Pte Limited) touched an all time high and the division recorded its highest ever global market share of 6% in FY 10. The first overseas hub of TSL was established in South Korea. In India, our Ferro Alloys and Minerals division is the market leader in Ferro Chrome business with a market share of around 27%. Manganese Alloys sales recorded an all time high in the financial year 2009-10 and Tata Steel attained the status of being the largest producer of Manganese Alloys in India.

 

3. Tubes division

During the financial year 2009-10, tubes division consolidated its position in the market place by registering a growth in production and sales by 11% and 10% respectively enabled by successful implementation of various improvement initiatives. Other key performance highlights of the division are appended below:

 

• The Tubes division has successfully launched and ramped up sales of Boron bearing steel tubes for the plumbing segment enabled by the stabilisation of the new state of art HF3 mill in a record time of six months.

• The ‘Tata Structura’ brand continued to grow through EVI (early vendor involvement) with leading infrastructure projects in airports and stadiums in preparation for the Delhi 2010 Commonwealth Games. The brand crossed a milestone of 3 lakh tonnes since its launch in December 2005.

 

• In the high end automotive segment, the growth in sales of precision tubes was given a thrust with the ramp up of hydroforming and cold drawn tubes facilities.

 

4. Bearings division

Driven primarily by the revival in demand in the domestic auto segment in 2009-10, sales and production of the Bearings division were higher by 23% and 8% respectively over the previous year.

Following are the highlights of the achievements of the division during the financial year 2009-10:

 

• The sales were higher by 9% over the previous best of 29 million numbers in the financial year 2006-07.

• In the Bearings industry, the division was the only one to win the Supplier Award from Bosch India Limited and the Silver Award for manufacturing and supply chain excellence from Economic Times and Frost and Sullivan.

• The Bearings division was awarded certification of upgraded version of ISO/TS 16949:2009 and ISO 9001:2008 Quality Management System and OHSAS 18001:2007 certifications by Underwriters Laboratories Inc.

 

Tata Steel Europe (TSE)

TSE has three main operating divisions; Strip Products, Long Products and Distribution and Building Systems. The EU is the most important market for the TSE Group, accounting for 79% of its total turnover in the financial year 2009-10. TSE produces carbon steel by the basic oxygen steelmaking method at three integrated steelworks in the UK at Port Talbot, Scunthorpe and Teesside (Teesside Cast Products unit was partially mothballed at the end of February 2010), and one in the Netherlands at IJmuiden. Principal end markets for TSE’s steel products are the construction, automotive, packaging, mechanical and electrical engineering, metal goods, and oil and gas industries.

 

The production and sales performance of TSE are shown below:

 

Figures in million tonnes

 

FY 10

FY 09

Change %

Crude steel production

14.4

15.8

(9%)

Deliveries

14.2

19.0

(25%)

 

Deliveries and subsequently production were affected during the financial year 2009-10 by the economic down turn although there were early signs of recovery in the quarter ending December 2009. The deliveries of the various divisions of TSE is shown in the following table:

 

Figures in million tonnes

 

FY 10

FY 09

Change %

Strip products

6.19

6.82

(9%)

Long products

4.41

6.57

(33%)

Distribution and building systems

3.58

5.40

(34%

Aluminum

--

0.21

--

Total

14.17

19.00

(25%

 

 

The destination wise break up of the sales is shown below:

 

 

FY 10

FY 09

Change %

UK

3.85

4.85

(21%)

Europe (excluding UK)

7.21

10.41

(31%)

North America

0.81

1.22

(34%)

Other Areas

2.31

2.52

(8%)

Total

14.17

19.00

(25%)

 

NatSteel Holdings

The key Geographies of NatSteel’s business are Singapore, China, Australia, Vietnam, Malaysia, Thailand and the Philippines. Most of the economies have done well coming out of the global financial crisis and the prognosis going forward is quite encouraging for the year.

 

The Singapore operations are EAF (Electric Arc Furnace)-based steel-making and rolling operations with a production capacity of about 0.750 million tonnes per annum. During the financial year 2009-10, sales of the Singapore operations at 0.75 million tones was 22% lower than that of last year. The Chinese subsidiary of NatSteel sold 0.532 million tonnes of rolled products during FY 10, 25% higher than the previous year and has been one of the most profi table businesses for the NatSteel Group during FY 2009-10.

 

In Vietnam the steel demand was robust and the construction demand had increased in line with the GDP growth of around 6.5% in 2009, which is expected to grow to around 7% in 2010. Similar to the Chinese subsidiary, the venture in Vietnam performed well in line with the country’s growth in demand. NatSteel Vina sold about 0.13 million tonnes of steel, 65% more than last year. The Australian business suffered the most as the economy took time to recover from the global financial crisis. However the last quarter of FY 2009-10 has been encouraging for few units especially in western Australia where the demand has shown encouraging trend owing to various oil and gas projects. NatSteel Australia and Best Bar sold around 0.12 million tonnes (30% lower than FY 09) of steel in the form of straight length rebars, mesh, cut and bend and other accessories. The wire plant at Thailand sold 0.152 million tonnes of wires, a growth of 20% in volumes as compared to the last year.

 

Tata Steel Thailand (TSTH)

TSTH recorded billet production of 1.18 million tonnes during the financial year 2009-10 with an increase of 6% over the financial year 2008-09 (1.11 million tonnes). Finished Goods production at 1.21 million tonnes during the financial year 2009-10 increased by 12.5% over the financial year 2008-09 (1.07 million tonnes). Sales volume at 1.20 million tonnes during the financial year 2009-10 was higher by 8% as compared to financial year 2008-09 (1.11 million tonnes) with 6% and 9% growth in the company’s domestic sales and exports volume. The Mini Blast Furnace was commissioned in October 2009. Along with the Mini Blast Furnace, all ancillary facilities have been progressively synchronised. Depressed prices driven by the recession and high metallic input costs resulted in the profit generated during FY 2008-09 turning into a loss during FY 2009-10.

 

Tata Metaliks

Tata Metaliks Limited (TML) a subsidiary of Subject, is the largest producer of Foundry Grade Pig Iron in India with plants in Kharagpur (West Bengal) and Redi (Maharashtra) with a total capacity of 0.650 Million tonnes per annum. In the financial year 2009-10, production of hot metal at 0.506 million tonnes was 34% higher than FY 2008-09. The sales of pig iron increased by 30% from 0.378 million tonnes during FY 2008-09 to 0.490 million tonnes during FY 2009-10 with an increase in market share from 13% in 2008-09 to 16% in 2009-10. During the year, the company has achieved a yield of more than 99% which is a benchmark in itself. Having suffered massive losses in the previous year mainly on account of high input prices and inventory write-down, the company rebounded to profits in the current financial year.

 

TM International Logistics Limited

TM International Logistics Limited (TMILL) is involved in the activity of running port operations at the Ports of Haldia and Paradip on the east coast of India backed by fully dedicated customs clearance and shipping agency services at both the ports. The company runs a clean dry cargo terminal at berth # 12 at Haldia, which is equipped with modern handling facilities including heavy equipments, shore cranes and vast open storage area as well as covered warehousing facilities. The shipping arm of TMILL offers integrated solutions to customers by packaging Ocean freighting with other auxiliary services like transloading and barging for draft-restricted ports or with port handling and ship agency services. The company currently operates ships with a variety of dry bulk cargo including fertilizers, limestone, metallurgical coke, sulphur, steel, logs, agricultural products etc.

 

The Freight Forwarding arm of TMILL is in the business of facilitating global trade by being an intermediary between cargo carriers and suppliers/buyers. Going beyond its traditional domain, TMILL has now ventured into providing marine services to the upcoming port at Dhamra.

 

Tayo Rolls Limited

Tayo Rolls Limited, a subsidiary of Subject, is a leading roll manufacturer in India, promoted by Subject, Yodogawa Steel Works, Japan and Sojitz Corporation Japan in 1968. To maintain its leadership position in the Cast Rolls Segment, Tayo entered into a technology know-how and license agreement with Yodogawa Steel Works of Japan for transfer of technology to manufacture Hi-Speed Steel Rolls, Semi Hi-Speed Steel Rolls and Super Nickel Grain Rolls. During the year, the steel industry reduced their rolls inventory resulting in lower off-take and deferment of delivery of confirmed orders. The sluggish casting market affected the pig iron off-take by various foundry units dependent on general casting and automobile casting. However, the pig iron demand and prices have picked up from the quarter ended December 2009.

 

Tata Steel Processing and Distribution Limited

Tata Steel Processing and Distribution Limited (erstwhile Tata Ryerson Limited) became a 100% subsidiary of Subject. w.e.f. July 2009. The company with a steel processing capacity of around 2 million tonnes with 5 steel processing centres across India, is the largest steel service centre in the country. The company has also started its business of manufacturing components for auto majors like Caterpillar and Tata Motors through its commissioned facilities at Tada (Andhra Pradesh) and Pantnagar (Uttarakhand) respectively. During the financial year 2009-10, the company recorded an all time high tolling and distribution volume of around 1.4 million tonnes 27% higher than that of last year and recording the highest profit before tax in its history of operations. Amongst several other achievements in the journey to Total Quality Management by the different units of the company, the most notable one was the coveted JIPM (Japan Institute of Plant Management) - TPM Excellence Award in Category – A won by the Company’s Jamshedpur Business Unit. Safety has remained a primary area of attention and by following Du Pont Safety initiatives, the company achieved a 47.5% reduction in injury and a 42% reduction in LTIFR compared to the financial year 2008-09.

 

Tinplate Company of India Limited

Tinplate Company of India Limited (TCIL) is the largest indigenous producer of tin coated and tin free steel sheets in India manufacturing various grades of electrolytic tinplates (ETP), tin-free steel (TFS) sheets and Full Hard Cold Rolled (FHCR) Sheets used for metal packaging. The company has been bonding with food processors and fillers by way of printing and lacquering facilities at the “Solution Centre”. Despite the delay in commissioning of the finishing units of the Cold Rolling Mill 2, the ETP production at 0.23 million tonnes in FY 10 was 22% higher from 0.19 million tonnes in FY 09, enabled by imports, stretching the capacity of the 6 hi Mill and improving efficiencies of the finishing units of the existing CRM. The Solution Centre recorded the highest production since inception (about 10% higher than last year) particularly with a 61% increase in production of printed sheets as compared to the last year. In order to improve the marketability of the increased capacity, TCIL has now been certified with ISO 22000 (Food Safety Certification). With over 70% of the products used for food cans, this certification is expected to significantly increase the acceptability of the products in the export markets which accounts for 25% of the company’s production. During the course of the financial year 2009-10, the company floated a simultaneous but unlinked Rights Issue of Rs. 3743.200 millions consisting of Equity Shares and Fully Convertible Debentures to fund the companies ongoing expansion programmes at Jamshedpur, including repayment of term loans and bridge loans taken for the same purpose. Consequent upon the Rights Issue, the holding of Tata Steel in TCIL has increased from 32% as at March 2009 to 45% as at March 2010.

 

Tata NYK Shipping Pte Limited

Tata NYK Shipping Pte Limited, a 50:50 joint venture between Subject., India and NYK Line, a Japanese shipping major, is primarily into the business of owning, operating and chartering of ships to carry dry bulk and break bulk cargo including coal, iron ore, bauxite and steel products mainly for Tata Group and Indian market. Within three years of its inception, the company has grown its fleet size rapidly from 1 ship in May 2007 to 11 ships (1 owned and 10 chartered) adding diversity in terms of different cargo carrying capacities. The vessels are classifi ed into Supramax (45,000 DWT to 60,000 DWT), Panamax (65,000 DWT to 80,000 DWT) and Capesize (150,000 DWT and over) vessels based on the tonnage capacity carried and are deployed based on the available port facilities and cargo requirements across the geographies. There was a growth of 52% in the cargo carried by the company during the financial year 2009-10 from 4.48 million tonnes in FY 2008-09 to 6.79 million tonnes in FY 2009-10 thereby increasing its revenues by 40%.

 

Tata Refractories Limited

Tata Refractories Limited. (TRL) is India’s leading Refractories producer, producing a full range of refractories with a service backup for total refractory solutions. TRL China Limited, a subsidiary of the company has undertaken third phase of expansion during the current financial year, targeted to be completed by December 2010, to increase its capacity from 54,000 tonnes per annum to 90,000 tonnes per annum. With the wide range of refractory products TRL has been meeting the growing needs of various industries like Steel, Cement, Glass, Copper, Zinc, Aluminium, Petro-Chemical etc. The Company has adopted a five year growth plan called “Mission 2000” to achieve a revenue of Rs. 20000.000 millions by FY 2012-13. During FY 10, the consolidated production was higher by 28% from 230k tonnes in FY 09 to 294k tonnes in FY 10. The consolidated sales were higher by 31% from 270k tonnes during FY 09 to 353k tonnes in FY 09. Exports were higher by 24% from Rs. 1030.000 millions in FY 09 to Rs. 1270.000 millions in FY 10.

 

Tata Sponge Iron Limited

Tata Sponge Iron Limited manufactures sponge iron at its manufacturing facility at Bilaipada at Joda Block of Keonjhar District in Orissa. During the fi nancial year 2009-10, all the three kilns were in operation and produced 0.359 million tonnes registering an increase of 5% as compared to 0.3423 million tonnes in financial year 2008-09. The capacity utilisation improved to 92% from 88% in the previous year. Sales during FY 2009-10 at 0.361 million tonnes improved by 5% over 0.343 million tonnes achieved during FY 2008-09 inspite of infrastructure bottlenecks such as berthing delays of ships, road transport disruptions and inadequacy of wagons. However, the prices of sponge iron fell as an effect of the economic slowdown. During the financial year 2009-10, the power plants (of 7.5 MW and 18.5 MW capacity) produced 181.39 million KWH of power as compared to 181.01 million KWH generated in FY 2008-09 while the sales of surplus power during FY 2009-10 were at 125.01 million KWH when compared with 124.82 million KWH sold in the previous year.

 

Tata Steel KZN Pte Limited

Tata Steel KZN, located at Richards Bay on the KwaZulu-Natal coast of South Africa, is in the business of making high carbon ferrochrome. During the financial year 2009-10, production volume at 118,327 tonnes increased by 86% as compared to 63,479 tonnes registered during FY 2008-09, driven by 96.27% furnace availability. The sales were higher by 212% from 41,537 tonnes in FY 2008-09 to 129,473 tonnes in FY 2009-10.

 

The operational highlights of the company during the year were the following:

• Major remedial work was carried out on the furnace wet scrubber and water treatment plants to improve furnace

availabilities and utilisation.

• Improved furnace stability and increased production achieved through better metallurgical control and superior quality ore.

• TSKZN increased the throughput of the Metal Recovery Plant to 150% of design capacity during the last two months of the financial year. This plant will remain an area of focus as it is critical to treat the current slag stockpile in order to adhere to the conditions set out by the Department of Environmental Affairs.

 

OUTLOOK

The global economic downturn is set to recover at a faster and stronger rate than expected earlier although the pace of recovery is anticipated to vary across geographies and economies. The Asian countries, in particular China and India, are leading the turnaround in the world economy as demand for commodities, intermediates and consumer goods in China is propelling economic activity in the rest of the region. The emerging countries have started to tighten their monetary policies to manage the recovery while inflationary pressures and rising asset prices are resurfacing as a challenge in those countries. The inflationary pressures in the developed economies remain subdued although they are expected to be at a level higher than 2009 resulting in lower interest rates in particular in the United States and European countries. World GDP is expected to grow at 3.5% in 2010.

 

The recovery in most of the economies will result from a turnaround in domestic demand with export momentum picking up for the developing countries and a modest export demand in developed economies. There is a global challenge of managing fiscal imbalances with large public debts in the developed economies. Debt problems in Greece and other East European countries pose a challenge to the European recovery and also to the global financial market stability. World consumption of steel is expected to be 1.23 billion tonnes in 2010 registering a growth of 10% over 2009. EU steel market is expected to slowly recover in 2010 with the inventory cycle being the main driver for increased demand during the first half and increase in consumption is anticipated to pick up in the middle of 2010. Crude steel production in the EU is accordingly expected to rise from the low of 2009 and be around 75-80% of the level of 2007-08. The exports during 2010 are expected to be higher by around 4% as compared to 2009 while imports in 2010 are also anticipated to increase by around 12.5% with rise in demand during the year. With economic and steel market conditions becoming more favourable and the steel producers needing to recover the rise in input costs. It is anticipated that there will be a strong rise in the steel prices in 2010-11. Buoyed by expected strong performances from consuming segments like automotive, construction, infrastructure and capital goods, carbon steel apparent consumption is expected to increase by more than 10% in FY 11. The Flat products’ consumption is expected to increase in FY 11 by 10.7% and that of long products by 10.3%. High disposable income, emphasis on infrastructure growth and India’s growing position as a manufacturing hub are primary drivers for the consumption. However, significant raw material price increases, interest rate tightening and inflation may provide some downsides to an otherwise positive outlook for the industry.

 

FINANCE

FY 10 has been a period of great economic difficulty in Europe and other developed markets. A very gradual economic recovery has started to take shape after a temporary but very sharp recession. In the second half of FY 09, a sharp decline in steel demand and prices, and reduced capacity utilisation had severely eroded the profitability of Tata Steel Europe (TSE).

 

In May 2009, TSE’s lenders consented to an amendment and waiver proposal with regard to financial performance covenants. While TSE would continue to meet interest and repayment obligations, testing of earnings related covenants was largely suspended till March 2010. The testing of covenants resumed in March 2010 and TSE is compliant with the same. As part of these amendments, Tata Steel infused Ł200 mn into TSE in June 2009 and Ł225 mn in September 2009. In the second half of FY 09 and the first quarter of FY 10, the Company had focused on raising additional debt in order to maintain a liquidity buffer given the uncertain nature of the steel markets. As a result in April 2009, the Company raised Rs. 20000.000 millions from a term loan and in May 2009, it privately placed Rs. 21500.000 millions of Non-Convertible Debentures repayable after 10 years. It also contracted a term loan of Rs. 6500.000 millions for 10 years and one of Rs. 1990.000 millions for 7 years. In July 2010, the Company issued GDRs (Global Depository Receipts) worth US$500 Million at US$7.644/

share (each GDR equals one share). This was one of the largest GDR offerings by an Indian Company on the London Stock Exchange. In the second half of FY 10, having weathered the liquidity crisis, the Company focused on restructuring liabilities and prepaying some of the debt in order to minimise finance charge costs and repayment risks.

 

In November 2009, the Company launched an exchange offer of new Foreign Currency Convertible Bonds (FCCBs) for any or all of its existing US$875,000,000 Convertible Alternative Reference Securities. The CARS carry a Yield To Maturity (YTM) of 5.15% p.a. (coupon of 1% p.a. and a one-time redemption premium of 23.3419%), due to mature in September 2012 and are convertible into underlying shares at Rs. 733.1318 per share. The new convertible bonds have a coupon (YTM) of 4.5%, maturing in November 2014 and are convertible into ordinary shares of the Company at Rs. 605.5325 per share.

 

The Company made the Exchange Offer with the objective of lengthening its debt maturity profi le, reducing cost and potentially reducing future repayment obligations. CARS worth US$493 million were tendered for exchange into FCCBs worth US$546.935 million. The Company also prepaid Rs. 20000.000 millions of its term debt in Dec’09 and Jan’10. It prepaid US$300 Million of foreign currency term loans in February and March 2010. In addition, Tata Steel Europe prepaid Ł100 Million of its term debt in June 2009. The Company achieved financial closure for its expansion of 2.9 MTPA in Jamshedpur for which it contracted long-term rupee borrowing aggregating to Rs. 93390.000 millions in Subject and its subsidiary, to be drawn over over the next three years years and to be repaid over a period of seven years. The Company also tied up ECA backed long term buyer’s credit (import financing) of Euro 264 mn to be drawn over the next two and half years and repaid over the next ten years. The Company is also in the process of obtaining an additional Euro 70 mn by way of further ECA backed long term buyer’s credit. The Company’s Credit Ratings remained stable in FY 10. In FY 09, Moody’s, S and P and Fitch had downgraded Tata Steel to below investment grade, largely on the back of increased leverage post acquisition of Corus and a depressed outlook for earnings. Moody’s has placed Tata Steel at a rating of Ba3 with a stable outlook, while both S and P and Fitch have retained their ratings of BB- and BB+ respectively with a negative outlook. As on 31.03.2010, the cash and cash equivalent in Subject, India was Rs. 32340.000 millions and Rs. 67880.000 millions for the Group.

 

Financial Results for the quarter / six months ended 30.09.2010

 

(Rs. in millions)

Particulars

Quarter Ended

Six Months Ended

30.09.2010

30.09.2010

 

 

Net Sales / Income from Operations

70381.300

15094.000

Other Operating Income

686.200

1488.300

Total Income [ 1(a) + 1(b) ]

71067.500

136582.300

Total Expenditure

 

 

(Increase) / decrease in stock-in-trade

443.700

(2957.200)

Purchases of finished, semi-finished steel and other products

381.400

745.300

Raw materials consumed

14811.700

27497.300

Staff Cost

6837.400

12618.800

Purchase of Power

3614.800

7163.300

Freight and handling

3602.700

7125.100

Depreciation

2814.600

5616.600

Other Expenditure

15085.600

28935.000

Total Expenditure (3a to 3h)

47591.900

86744.200

Profit / (Loss) from Operations before Other Income, Net

Finance Charges, Exceptional Items and Tax [

23475.600

49838.100

Other Income

7326.700

7811.000

Profit / (Loss) from Operations before Net Finance

Charges, Exceptional Items and Tax

30802.300

57649.100

Net Finance Charges

3424.800

6701.600

Profit / (Loss) before Exceptional Items and Tax

27377.500

50947.500

Exceptional Items

-

-

Restructuring Costs

-

-

Profit / (Loss) before Tax

27377.500

50947.500

Tax Expense

6726.200

14502.300

Net Profit (+) / Loss (-)

20651.300

36445.200

Minority Interest

-

-

Share of profit of associates

-

-

Profit after Minority Interest and Share of profit of

Associates

-

-

Paid-up Equity Share Capital

[Face value Rs.10 per share]

9024.100

9024.100

Paid up debt capital

-

99767.600

Reserves excluding revaluation reserves

-

-

Debenture Redemption Reserve

-

10460.000

Basic Earnings per share (after Exceptional items)

(not annualised)

22.98

40.81

Diluted Earnings per share (after Exceptional items)

(not annualised)

21.51

38.71

Net Debt Equity Ration

-

6.100

Debt service coverage ratio

-

20.700

Interest service coverage ratio

-

86.000

Aggregate of Public Share Holding

 

 

- Number of Shares

603421463

603421463

- Percentage of shareholding

67.31%

67.31%

Promoters and Promoter group share holding

 

 

a) Pledged / Encumbered

 

 

- Number of Shares

-

-

- Percentage of share (as a % of the total shareholding of promoter and promoter group)

-

-

- Percentage of shares(as a % of the total share capital of the company)

-

-

b) Non-encumbered

 

 

- Number of Shares

293035480

293035480

- Percentage of Share (as a % of the total shareholding of promoter and promoter group)

100.00%

100.00%

 - Percentage of Share (as a % of the total share capital of the company)

32.48%

32.48%

 

 

Segment Revenue, Results and Capital Employed

 

 (Rs. in millions)

Particulars

Quarter Ended

Six Months Ended

30.09.2010

30.09.2010

 

 

Revenue by Business Segment:

 

 

Steel business

64971.400

124947.500

Ferro Alloys and Minerals

6052.400

11397.900

Others

4487.600

8879.900

Unallocated

-

-

Total

75511.400

145225.300

Less: Inter segment revenue

4443.900

8643.000

Net Sales / Income from Operations

71067.500

136582.300

Segment Results before Net Finance Charges, Exceptional Items and Tax:

 

 

Steel business

21764.000

46438.000

Ferro Alloys and Minerals

1994.200

4028.600

Others

43.200

416.600

Unallocated income / (expenditure)

7000.900

6765.900

Less: Inter Segment Eliminations

-

-

Total Segment Results before Net Finance Charges, Exceptional Items and Tax:

30802.300

57649.100

Less: Net Finance Charges

3424.800

6701.600

Profit / (Loss) before Exceptional Items and Tax

27377.500

50947.500

Exceptional Items:

-

-

Restructuring Costs

-

-

Profit / (Loss) before Tax

27377.500

50947.500

Less: Tax Expense

6726.200

14502.300

Net Profit (+) / Loss (-)

20651.300

36445.200

Segment Capital Employed:

 

 

Steel business

150295.900

150295.900

Ferro Alloys and Minerals

3457.000

3457.000

Others

2346.200

2346.200

Unallocated

56247.200

56247.200

Inter Segment Eliminations

-

-

Total

212346.300

212346.300

 

Statement of Assets and Liabilities

Rs. In Millions

Particulars

Six months ended on 30.09.2010

 

Audited

Shareholders Funds

 

a) Capital

9024.100

b) share Warrants

1782.000

c) Reserves and Surplus

406043.000

Warrants Issued by a subsidiary company

 

Minority interests

 

Loan funds

257575.900

Deferred tax liability

9438.900

Foreign currency monetary item translation difference account

1450.100

Provision for employee separation compensation

9098.300

Total

694412.300

Fixed assets

173597.000

Investments

435045.400

Goodwill on consolidation

 

Deferred tax assets

 

Foreign currency monetary item translation difference account

 

Current assets, loans and advances

 

a) Inventories

42594.700

b) Sundry debtors

6181.200

c) cash and bank balances

15961.400

d) Other current assets

-

d) loans and advances

118713.200

Less: Current liabilities and provisions

 

a) Current liabilities

72726.600

b) Provisions

24954.000

Miscellaneous Expenditure (Not written off or adjusted)

-

Total

694412.300

 

 

Notes:

1. The actuarial gains and losses on funds for employee benefits (pension plans) of Tata Steel Europe Limited for the period from 01.04.2008 have been accounted in “Reserves and Surplus” in the consolidated financial statements in accordance with IFRS principles and permitted by Accounting Standard 21. Had the Company recognised changes in actuarial valuations of pension plans of Tata Steel Europe in the profit and loss account, the consolidated profit after taxes, minority interest and share of profit of associates for the six months ended 30.09.2010 would have been lower by Rs. 9603.900 millions (Rs.2658.300 millions for the quarter) and the consolidated loss after taxes, minority interest and share of profit of associates for the six months ended 30.09.2009 would have been higher by Rs. 22825.400 millions (Rs.1354.400 millions for the quarter ended  30.09.2009).

 

2. NatSteel Holdings Pte. Limited, a subsidiary of the Company, has divested its stake in Southern Steel Berhad, Malaysia at a total consideration of RM 232.42 mn (equivalent US$72 mn).

 

3. Information on investor complaints pursuant to clause 41 of the listing agreement for the quarter ended 30.09.2010:

 

Opening balance

Received during the quarter

Resolved during the quarter

Closing balance

9

142

104

47

 

Of the total 47 unresolved complaints, 42 complaints pertain to non-receipt of dividend warrants where reconciliation of the payment is in progress. Replies have been sent to the investors giving warrant details and conveying that fresh warrants, if found outstanding, can be issued after bank reconciliation process. Remaining 5 complaints pertain to miscellaneous issues.

 

4. Figures for the previous period have been regrouped and reclassified to conform to the classification of the current period, wherever necessary.

 

5. The consolidated financial results have been subjected to limited review and the stand-alone financial results have been audited by the statutory auditors.

 

6. The above results have been reviewed by the Audit Committee in its meeting held on 11.11.2010 and were approved by the Board of Directors in its meeting of date.

 

 

 

Contingent Liabilities

 

(a) Guarantees

 

The Company has given guarantees aggregating Rs. 812.200 Millions (31.03.2008: Rs. 1062.200 Millions) to banks and financial institutions on behalf of others. As at 31st March, 2009, the contingent liabilities under these guarantees amounted to Rs. 812.200 Millions (31.03.2008: Rs. 1062.200 Millions).

 

(b) Claims not acknowledged by the Company

 

 

Particular

31.03.2009

31.03.2008

Excise 

3406.100

1934.700

Customs

136.800

136.600

Sales Tax

4560.100

4468.900

State Levies

1546.700

967.800

Suppliers and Service Contract

705.200

813.500

Labour Related

346.300

329.800

Income Tax

1766.000

578.300

 

(c) Claim by a party arising out of conversion arrangement - Rs.1958.200 Millions (31.03.2008: Rs.1958.200 Millions). The Company has not acknowledged this claim and has instead filed a claim of Rs.1396.500 Millions (31.03.2008: Rs.1396.500 Millions) on the party. The matter is pending before the Calcutta High Court.

 

 

FIXED ASSETS:

  • Land and Roads
  • Buildings
  • Lease-hold
  • Railway Sidings
  • Plant and Machinery
  • Furniture, Fixture
  • Office Equipment
  • Development of Property
  • Vehicles

 

AS PER WEBSITE DETAILS

 

PROFILE:

 

The Subject Group has always believed that mutual benefit of countries, corporations and communities is the most effective route to growth. Subject has not limited its operations and businesses within India but has built an imposing presence around the globe as well. With the acquisition of Corus in 2007 leading to commencement of Subjects European operations, the Company today is the tenth largest steel producer in the world with an employee strength of above 81,000 across five continents. During the financial year 2009-10, the Group recorded deliveries of 24 million tonnes against 28 million tonnes in the previous year, the decline being a reflection of the global economic slowdown mainly in the UK and European operations. The Group recorded a turnover of Rs.102, 393 Millions in 2009 - 2010. The Company has always had significant impact on the economic development in India and now seeks to strengthen its position of pre-eminence in international domain by continuing to lead by example of responsibility and trust.

 

Tata Steel’s overseas ventures and investments in global companies have helped the Company create a manufacturing and marketing network in Europe, South East Asia and the Pacific-rim countries. The Group’s South East Asian operations comprise Tata Steel Thailand, in which it has 67.1% equity and Nat Steel Holdings, which is one of the largest steel producers in the Asia Pacific with presence across seven countries.

 

Given below is an outline of Tata Steel's operations in Europe and South East Asia.

 

Awards and Recognitions:

 

  • Tata Steel India awarded the Deming Application Prize 2008 for excellence in Total Quality Management. It is the first integrated steel company in the world, outside Japan to get this award.
  • World Steel Dynamics has ranked Tata Steel as the world's best steel maker (for two consecutive years) in its annual listing in February 2006.
  • Tata Steel has been conferred the Prime Minister of India's Trophy for the Best Integrated Steel Plant five times.
  • It has been awarded Asia's Most Admired Knowledge Enterprise award five times in 2003, 2004, 2006, 2007 and 2008.
  • Conferred the prestigious Global Business Coalition Award for Business Excellence in the Community in recognition of its pioneering work in the field of HIV/ AIDS awareness.
  • Tata Steel works has been conferred the prestigious social accountability (SA) 8000 certification by social. Accountability international (SAI), USA. It is the first steel company in the world to receive this certificate.
  • Corporate Sustainability Report of Tata Steel hailed by United Nation's Environment Programme (UNEP) and Standard and poor as strongest, submitted by any corporate house from emerging economies.
  • Best governed company Award 2006 for setting high standards in governance practices.
  • Tata Steel won "Award for Corporate Social Responsibility in Public health" by US- Indian Business Council (USIBC), Population Services International (PSI) and the center for Strategic and International Studies (CSIS) in 2007.

 

PRESS RELEASE

 

Mumbai – 11.01.2011

 

Tata Steel wins the 'The Businessworld Most Respected Company Award 2011'

New Delhi, 2/9/2011

 

Tata Steel has won `The Businessworld Most Respected Company Award 2011’ in the Metals category. The award is a result of the findings of a two-phased, sector-wise survey that was conducted across 20 industry verticals by Businessworld magazine.

 

The various parameters under which companies were evaluated included financial performance and returns, innovativeness, depth and quality of top management, ethics and transparency, global competitiveness, quality of products and services and people and talent management practices.

 

Tata Steel’s Resident Executive in New Delhi, Mr Sanjay Nath Singh, received the award from the Union Finance Minister, Mr Pranab Mukherjee, at a function held in New Delhi on 08.02.2011. Others present on the occasion included Mr Aveek Sarkar, Editor of the ABP Group of publications.

 

Businessworld has stated that Tata Steel ranked “way ahead of others on all seven parameters of the Most Respected Companies Survey 2011”.

 

About Tata Steel

Established in 1907 as Asia's first integrated private sector steel company, Tata Steel Group is among the top-ten global steel companies with an annual crude steel capacity of over 28 million tonnes per annum (mtpa). It is now the world's second-most geographically-diversified steel producer, with operations in 26 countries and a commercial presence in over 50 countries. The Tata Steel Group, with a turnover of US$ 23 billion in FY 10, has over 80,000 employees across five continents and is a Fortune 500 company. The Group’s vision is to be the world’s steel industry benchmark in “Value Creation” and “Corporate Citizenship” through the excellence of its people, its innovative approach and overall conduct. Underpinning this vision is a performance culture committed to aspiration targets, safety and social responsibility, continuous improvement, openness and transparency. In 2008, Tata Steel India became the first integrated steel plant in the world, outside Japan, to be awarded the Deming Application Prize 2008 for excellence in Total Quality Management.

 

 

 

 

CMT REPORT (Corruption, Money Laundering & Terrorism]

 

The Public Notice information has been collected from various sources including but not limited to: The Courts, India Prisons Service, Interpol, etc.

 

1]         INFORMATION ON DESIGNATED PARTY

No exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.

 

2]         Court Declaration :

No exist to suggest that subject is or was the subject of any formal or informal allegations, prosecutions or other official proceeding for making any prohibited payments or other improper payments to government officials for engaging in prohibited transactions or with designated parties.

 

3]         Asset Declaration :

No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.

 

4]         Record on Financial Crime :

            Charges or conviction registered against subject:                                                              None

 

5]         Records on Violation of Anti-Corruption Laws :

            Charges or investigation registered against subject:                                                          None

 

6]         Records on Int’l Anti-Money Laundering Laws/Standards :

            Charges or investigation registered against subject:                                                          None

 

7]         Criminal Records

No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.

 

8]         Affiliation with Government :

No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.

 

9]         Compensation Package :

The market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.

 

10]        Press Report :

            No press reports / filings exists on the subject.

 

 

CORPORATE GOVERNANCE

 

MIRA INFORM as part of its Due Diligence do provide comments on Corporate Governance to identify management and governance. These factors often have been predictive and in some cases have created vulnerabilities to credit deterioration.

 

The Governance Assessment focuses principally on the interactions between a company’s management, its Board of Directors, Shareholders and other financial stakeholders.

 

 

CONTRAVENTION

 

Subject is not known to have contravened any existing local laws, regulations or policies that prohibit, restrict or otherwise affect the terms and conditions that could be included in the agreement with the subject.

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs. 45.45

UK Pound

1

Rs. 72.90

Euro

1

Rs. 61.43

 

SCORE & RATING EXPLANATIONS

 

SCORE FACTORS

 

RANGE

POINTS

HISTORY

1~10

9

PAID-UP CAPITAL

1~10

8

OPERATING SCALE

1~10

9

FINANCIAL CONDITION

 

 

--BUSINESS SCALE

1~10

9

--PROFITABILIRY

1~10

9

--LIQUIDITY

1~10

9

--LEVERAGE

1~10

9

--RESERVES

1~10

8

--CREDIT LINES

1~10

8

--MARGINS

-5~5

--

DEMERIT POINTS

 

 

--BANK CHARGES

YES/NO

YES

--LITIGATION

YES/NO

NO

--OTHER ADVERSE INFORMATION

YES/NO

NO

MERIT POINTS

 

 

--SOLE DISTRIBUTORSHIP

YES/NO

NO

--EXPORT ACTIVITIES

YES/NO

YES

--AFFILIATION

YES/NO

YES

--LISTED

YES/NO

YES

--OTHER MERIT FACTORS

YES/NO

YES

TOTAL

 

78

 

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                 Payment record (10%)

Credit history (10%)                    Market trend (10%)                                Operational size (10%)

 

 

RATING EXPLANATIONS

 

RATING

STATUS

 

 

PROPOSED CREDIT LINE

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

 

Fairly Large

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

 

Small

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

 

Credit not recommended

-

NB

                                       New Business

-

 

 

 

 

 

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.