MIRA
INFORM REPORT
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Report Date : |
29.09.2011 |
IDENTIFICATION DETAILS
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Name : |
TATA STEEL LIMITED TATA TUBES DIVISION OF TATA STEEL LIMITED |
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Registered
Office : |
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Country : |
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Financials (as
on) : |
31.03.2011 |
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Date of
Incorporation : |
26.08.1907 |
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Com. Reg. No.: |
11-000260 |
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Capital
Investment / Paid-up Capital : |
Rs. 8874.100 millions |
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CIN No.: [Company Identification
No.] |
L27100MH1907PLC000260 |
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TAN No.: [Tax Deduction &
Collection Account No.] |
MUMT00249E MUMT10796C |
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PAN No.: [Permanent Account No.] |
AAACT2803M AAATT0188H |
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Legal Form : |
Public Limited Liability Company. The company’s shares are listed on the Stock Exchanges. |
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Line of Business
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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. |
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No. of Employees
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38000 (Approximately) |
RATING & COMMENTS
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MIRA’s Rating : |
Aa (78) |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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 |
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Maximum Credit Limit : |
USD 1877785200 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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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
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Country Name |
Previous Rating (31.12.2009) |
Current Rating (01.04.2010) |
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A1 |
A1 |
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Risk Category |
ECGC Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
LOCATIONS
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Registered Office : |
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Tel. No.: |
91-22-56658282 / 66658282 |
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Fax No.: |
91-22-56658113 / 56658119 / 66657725/ 24 |
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E-Mail : |
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Website : |
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Corporate Office : |
Design Call, 3rd Floor, General Office, Tata
Steel, |
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Websites: |
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Factory 1 : |
Agrico and Tubes
Division 43, Jawaharlal
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Tel. No.: |
91-33-22885930/65508120/65508021/2288-3425 / 2224-8536 |
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Fax No.: |
91-33-22886996/91-33-2288-8850 |
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Factory 2 : |
Bearings Division
43, Jawaharlal
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Tel. No.: |
91-33-22248672/8187/65508006 |
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Fax No.: |
91-33-22881962 |
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Factory 3 : |
Flat Products
Division 43, Jawaharlal
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Tel. No.: |
86608197/86608626/1800-3458282 (Toll Free) |
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Factory 4 : |
Long Products
Division 43, Jawaharlal
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Tel. No.: |
91-33-22882278/22248104 |
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Fax No.: |
91-33-22881640/1163 |
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Factory 5 : |
FAMD 43, Jawaharlal
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Tel. No.: |
91-33-22882736/65508134 |
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Fax No.: |
91-33-22885015 |
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Factory 6 : |
Bamnipal - 758 082,
District - Keonjhar, |
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Tel. No.: |
91-6726-243361 |
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Fax No.: |
91-6726-243324 |
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Branches : |
43, |
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Tel. No.: |
91-657-2431024 |
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Fax No.: |
91-657-2431818 |
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International Offices : |
Located at:
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DIRECTORS
As On 31.03.2010
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Name : |
Mr. Ratan N. Tata |
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Designation : |
Chairman |
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Name : |
Mr. B. Muthuraman |
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Designation : |
Managing Director
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Name : |
Mr. Nusli N. Wadia |
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Designation : |
Director |
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Name : |
Mr. S. M. Palia |
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Designation : |
Director |
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Name : |
Mr. P. K. Kaul |
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Designation : |
Director –
Nominee [IDBI] |
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Name : |
Mr. Suresh Krishna |
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Designation : |
Director |
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Name : |
Mr. Kumar Mangalam Birla |
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Designation : |
Director |
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Name : |
Mr. Ishaat Hussain |
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Designation : |
Director |
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Name : |
Dr. Jamshed J. Irani |
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Designation : |
Director |
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Name : |
Mr. B. Jitender |
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Designation : |
Director |
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Name : |
Dr. T. Mukherjee |
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Designation : |
Deputy Managing Director |
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Name : |
Mr. A. N. Singh |
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Designation : |
Director |
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Name : |
Mr. Subodh Bhargava |
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Designation : |
Additional Director |
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Name : |
Mr. Philippe Varin |
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Designation : |
Director |
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Name : |
Mr. Jacobus Schraven |
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Designation : |
Director |
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Name : |
Mr. Anthony Hayward |
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Designation : |
Director |
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Name : |
Mr. James Leng |
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Designation : |
Deputy Chairman |
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Name : |
Mr. Andrew Robb |
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Designation : |
Additional Director |
KEY EXECUTIVES
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Name : |
Mr. J C Bham |
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Designation : |
Company Secretary |
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Name : |
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Designation : |
Chief Operating Officer |
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Name : |
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Designation : |
Vice President and Tata Steel
Group Director, Global Mineral Resources |
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Name : |
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Designation : |
Vice President, Engineering Services and Projects |
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Name : |
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Designation : |
Vice President, Finance and Tata Steel Group CFO |
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Name : |
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Designation : |
Vice President, Flat Products and TQM |
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Name : |
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Designation : |
Vice President, Raw Materials and CSI |
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Name : |
Mr. Kirby Adams |
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Designation : |
Chief Executive Officer (Tat Steel Europe) |
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Name : |
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Designation : |
Vice President, Chattisgarh Project |
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Name : |
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Designation : |
Vice President, Shared Services |
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Name : |
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Designation : |
Chief Human Resource Officer |
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Name : |
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Designation: |
Vice President, Corporate Services |
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Name : |
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Designation: |
Vice President, Safety and Long Products |
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Name : |
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Designation: |
Vice President and Tata Steel
Group Head, M and A |
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Name : |
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Designation: |
Vice President, Orissa Project |
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Name : |
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Designation: |
Vice President, MD Office, Mumbai |
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Name : |
Mr. Jean Sebastien Jacques |
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Designation : |
Group Director (strategy) |
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Name : |
Mr. Manzeer Hussain |
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Designation : |
Group Director (Communications) |
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Name : |
Mr. Avneesh Gupta |
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Designation : |
Group Director (Total Quality Management) |
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Name : |
Mr. Marjan Oudeman |
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Designation : |
Divisional Director (Strip Products) TSE |
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Name : |
Mr. Scott MacDonald |
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Designation : |
Divisional Director (Distribution and Building Systems), TSE |
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Name : |
Mr. Phil Dryden |
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Designation : |
Divisional Director (Long Products) TSE |
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Name : |
Mr. Frank Royle |
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Designation : |
Director (Finance) TSE |
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Name : |
Mr. Tor Farquhar |
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Designation : |
Director (Human Resources) TSE |
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Name : |
Mr. Santi Charnkolrawee |
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Designation : |
President Tata Steel |
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Name : |
Mr. T.V. Narendran |
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Designation : |
President and Chief Executive Officer Natsteel Holdings |
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Name : |
Mr. V.S.N. Murty |
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Designation : |
Chief Fiannacial Controller (Corporate) TSL |
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Name : |
Mrs. Helen Matheson |
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Designation : |
Director (Legal, Compliance and Secretariat)TSE |
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Name : |
Mr. Sandip Biswas |
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Designation : |
Group Head (Corporate Finance, Treasury and Investor Relations) |
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Name : |
Mr. Lim Say Yan |
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Designation : |
Group Head (Corporate Assurance and Risk Management) |
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Name : |
Mr. Bimlendra Jha |
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Designation : |
Principal Executive Officer to Managing Director TSL |
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Name : |
Dr. Debashish Bhattacharjee |
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Designation : |
Director (Research, Development and Technology) |
MAJOR SHAREHOLDERS / SHAREHOLDING PATTERN
AS ON 30.06.2011
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Category of Shareholders |
No. of Shares |
Percentage of
Holding |
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(A) Shareholding
of Promoter and Promoter Group |
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292518060 |
31.28 |
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1031460 |
0.11 |
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(B) Public
Shareholding |
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32457309 |
3.47 |
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3446763 |
0.37 |
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121659 |
0.01 |
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216275120 |
23.12 |
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163666381 |
17.50 |
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1421880 |
0.15 |
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85411 |
0.01 |
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3000 |
-- |
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27784607 |
2.97 |
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170568579 |
18.24 |
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25894168 |
2.77 |
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5925 |
-- |
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(C) Shares held
by Custodians and against which Depository Receipts have been issued |
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-- |
-- |
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23934128 |
2.50 |
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Total |
959214450 |
100.00 |
(1) Indian
Bodies Corporate
TrustsBUSINESS DETAILS
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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. |
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Products: |
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GENERAL INFORMATION
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38000 (Approximately) |
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Bankers
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Facilities : |
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 (d) 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 fl oating charge on other properties and assets (excluding investments) of the Company, subject to the prior fl oating charge in favour of State Bank of India and other banks under items c(i) and c(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 1,3174.900 Millions (31.03.2010: Rs.1,2025.400 Millions) representing repayments and interest on earlier loans for which applications of funding are awaiting sanction.
Note : Amounts
repayable within one year Rs.36529.500 Millions (31.03.2010 : Rs.
16042.000 millions). * Repayable in foreign currency. |
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Banking
Relations : |
-- |
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Auditors
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Name: |
Deloitte Haskions and Sells Chartered Accounts |
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Associates
: |
· Tata Tele-services Limited · Nicco Jubilee Park Limited ·
· Kalinga Aquatics Limited · Adityapur Toll Bridge Limited ·
Tinplate Company of · 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 · Tata Finance Limited |
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Subsidiaries |
1.
Haldia
Water Management Limited 2.
Naba
Diganta Water Management Limited 3.
SEZ
Adityapur Limited
1.
Bangla
Steel and Mining Company Limited
1.
NatSteel
Iranian Private Joint Stock Company 2.
NatSteel
Middle 3.
Tata
Steel Asia ( 4.
Tata
Steel Resources Australia Pty. Limited
1.
Tata
Metaliks Kubota Pipes Limited
1.
TRL
Asia Private Limited 2.
TRL
China Limited
a) NSA Holdings Pte Limited b) Tata Steel Global Holdings Pte Limited
1.
Corus
Holdings ( 2.
Corus
International ( 3.
Corus
International ( 4.
Corus
Metals ( 5.
Corus
Metals ( 6.
Corus
South East Asia Pte Limited 7.
Tata
Steel international ( 8.
Tata
Steel International (Hongkong) Limited Hongkong |
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Joint
Venture : |
·
Tata
Steel Limited 1.
Bhubaneshwar
Power Private Limited 2.
mjunction
services Limited 3.
S and
T Mining Company Private Limited 4.
Tata
Bluescope Steel Limited 5.
Tata
NYK Shipping Pte Limited 6.
Tata
Steel Processing And Distribution Limited * 7.
The
Dhamra Port Company Limited ·
Tata
Steel Holdings Pte. Limited a) Tata Steel
Global Holdings Pte Limited I Tata Steel
Europe Limited
II Tata Steel Global
Minerals Holdings Pte. Limited
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Parent
Company : |
Tata Sons Limited |
CAPITAL STRUCTURE
AS ON 31.03.2011
Authorised Capital :
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No. of Shares |
Type |
Value |
Amount |
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1750000000 |
Ordinary Shares |
Rs.10/-each |
Rs.17500.000 millions |
|
350000000 |
“A” Ordinary
Shares |
Rs.10/-each |
Rs.3500.000 Millions |
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25000000 |
Cumulative Redeemable Preference Shares |
Rs.100/-each |
Rs.2500.000 millions |
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600000000 |
2% Cumulative Convertible Preference Shares |
Rs.100/-each |
Rs.60000.000 millions |
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Total |
Rs. 80000.000 millions |
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Issued Capital :
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No. of Shares |
Type |
Value |
Amount |
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888126020 |
Ordinary Shares |
Rs.10/-each |
Rs.8881.300 millions |
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Subscribed Capital:
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No. of Shares |
Type |
Value |
Amount |
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887214196 |
Ordinary Shares |
Rs.10/-each |
Rs.8872.100 millions |
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Add |
Amount paid up
on Ordinary Shares forfeited |
Rs.10/- each |
Rs. 2.000 millions |
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Total |
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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.
(p) 1,50,00,000 Ordinary Shares of face value of
Rs.10 per share issued to Tata Sons Limited on Preferential basis during the
year 2010-11.
(q) 5,70,00,000 Ordinary Shares of face value of
Rs.10 per share allotted on 29th January, 2011 at a premium of ` 600 per share
in the Follow-on Public Offer vide Prospectus dated 25th January, 2011.
(r) 1) 146 Ordinary Shares of face value of Rs.10
per share allotted on rights basis at a premium of ` 290 per share to
shareholders whose shares were kept in abeyance in the Rights issue made in
2007.
2) 108 Ordinary 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 conversion whose shares were kept in abeyance in the Rights
issue made in 2007. The balance Ordinary shares kept in abeyance are 3,07,807.
FINANCIAL DATA
[all figures are
in Rupees Millions]
ABRIDGED BALANCE
SHEET
|
SOURCES OF FUNDS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
9594.100 |
8874.100 |
62034.500 |
|
|
2] Share Application Money |
1782.000 |
0.000 |
0.000 |
|
|
3] Reserves & Surplus |
458070.200 |
360743.900 |
239728.100 |
|
|
4] (Accumulated Losses) |
0.000 |
0.000 |
0.000 |
|
|
NETWORTH |
469446.300 |
369618.000 |
301762.600 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
20092.000 |
22593.200 |
39130.500 |
|
|
2] Unsecured Loans |
262919.400 |
229798.800 |
230331.300 |
|
|
TOTAL BORROWING |
283011.400 |
252392.000 |
269461.800 |
|
|
DEFERRED TAX LIABILITIES |
9368.000 |
8676.700 |
5857.300 |
|
|
Provision for employees separation compensation |
8733.400 |
9571.600 |
10336.000 |
|
|
Foreign currency monetary item translation difference
account |
0.000 |
2069.500 |
0.0000 |
|
|
HYBRID PERPETUAL SECURITIES |
15000.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
TOTAL |
785559.100 |
642327.800 |
587417.700 |
|
|
|
|
|
|
|
|
APPLICATION OF FUNDS |
|
|
|
|
|
|
|
|
|
|
|
FIXED ASSETS [Net Block] |
187744.800 |
160060.300 |
144822.200 |
|
|
Capital work-in-progress |
0.000 |
0.000 |
0.000 |
|
|
|
|
|
|
|
|
INVESTMENT |
465649.400 |
449796.700 |
423717.800 |
|
|
DEFERREX TAX ASSETS |
0.000 |
0.000 |
0.000 |
|
|
Foreign Currency Monetary Item Translation Difference
Account |
0.000 |
0.000 |
4716.600 |
|
|
|
|
|
|
|
|
CURRENT ASSETS, LOANS & ADVANCES |
|
|
|
|
|
|
Inventories |
32375.800
|
24539.900
|
28682.800
|
|
|
Sundry Debtors |
4280.300
|
4348.300
|
6359.800
|
|
|
Cash & Bank Balances |
41415.400
|
32341.400
|
15906.000
|
|
|
Other Current Assets |
7161.800
|
6240.500
|
6121.900
|
|
|
Loans & Advances |
156889.700
|
54996.800
|
45610.400
|
|
Total
Current Assets |
242123.000
|
122466.900
|
102680.900
|
|
|
Less : CURRENT LIABILITIES & PROVISIONS |
|
|
|
|
|
|
Sundry Creditors |
31395.100
|
40866.500
|
38427.900
|
|
|
Other Current Liabilities |
43083.200
|
25664.400
|
21970.700
|
|
|
Provisions |
35479.800
|
23465.200
|
29171.900
|
|
Total
Current Liabilities |
109958.100
|
89996.100
|
89570.500
|
|
|
Net Current Assets |
132164.900
|
32470.800
|
13110.400
|
|
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES |
0.000 |
0.000 |
1050.700 |
|
|
|
|
|
|
|
|
TOTAL |
785559.100 |
642327.800 |
587417.700 |
|
PROFIT & LOSS
ACCOUNT
|
|
PARTICULARS |
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
|
|
SALES |
|
|
|
|
|
|
|
Income |
293963.500 |
250219.800 |
243157.700 |
|
|
|
Other Income |
7906.700 |
8537.900 |
3082.700 |
|
|
|
TOTAL (A) |
301870.200 |
258757.700 |
246240.400 |
|
|
|
|
|
|
|
|
Less |
EXPENSES |
|
|
|
|
|
|
|
Manufacturing and Other Expenses |
181622.700 |
163960.000 |
155259.900 |
|
|
|
Expenditure (Other than Interest)
Transferred to Capital and other accounts |
(1987.800) |
(3261.100) |
(3436.500) |
|
|
|
TOTAL (B) |
179634.900 |
160698.900 |
151823.400 |
|
|
|
|
|
|
|
|
Less |
PROFIT
BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION (A-B) (C) |
122235.300 |
98058.800 |
94417.000 |
|
|
|
|
|
|
|
|
|
Less |
FINANCIAL
EXPENSES (D) |
13004.900 |
15084.000 |
11526.900 |
|
|
|
|
|
|
|
|
|
|
PROFIT
BEFORE TAX, DEPRECIATION AND AMORTISATION (C-D) (E) |
109230.400 |
82974.800 |
82890.100 |
|
|
|
|
|
|
|
|
|
Less/ Add |
DEPRECIATION/
AMORTISATION (F) |
11461.900 |
10831.800 |
9734.000 |
|
|
|
|
|
|
|
|
|
|
PROFIT BEFORE
TAX (E-F) (G) |
97768.500 |
72143.000 |
73156.100 |
|
|
|
|
|
|
|
|
|
Less |
TAX (H) |
29111.600 |
21675.000 |
21138.700 |
|
|
|
|
|
|
|
|
|
|
PROFIT AFTER TAX
(G-H) (I) |
68656.900 |
50468.000 |
52017.400 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Add |
PREVIOUS
YEARS’ BALANCE BROUGHT FORWARD |
127726.500 |
94967.000 |
63874.600 |
|
|
|
|
|
|
|
|
|
|
BALANCE
BROUGHT FORWARD – HOOGHLY MET COKE AND POWER COMPANY LIMITED ON AMALGAMATION |
0.000 |
122.800 |
0.000 |
|
|
|
|
|
|
|
|
|
Less |
APPROPRIATIONS |
|
|
|
|
|
|
|
Proposed Dividends |
11510.600 |
7097.700 |
11689.500 |
|
|
|
Dividend on Cumulative Convertible
Preference Shares |
0.000 |
458.800 |
1094.500 |
|
|
|
Tax on Dividends |
1567.100 |
1228.000 |
2141.000 |
|
|
|
General Reserve |
6865.700 |
5046.800 |
6000.000 |
|
|
|
Debenture Redemption Reserve |
10000.000 |
4000.000 |
0.000 |
|
|
BALANCE CARRIED
TO THE B/S |
166394.600 |
127726.500 |
94967.000 |
|
|
|
|
|
|
|
|
|
|
IMPORTS |
|
|
|
|
|
|
|
Raw Materials |
43695.400 |
31025.700 |
41467.500 |
|
|
|
Semi-Finished Products |
235.500 |
53.800 |
280.200 |
|
|
|
Components, Stores and Spare Parts |
3534.800 |
2618.800 |
2884.200 |
|
|
|
Capital Goods |
7124.500 |
6727.100 |
5422.800 |
|
|
TOTAL IMPORTS |
54590.200 |
40425.400 |
50054.700 |
|
|
|
|
|
|
|
|
|
|
Earnings Per
Share (Rs.) |
|
|
|
|
|
|
- Basic |
75.63 |
60.26 |
69.45 |
|
|
|
|
||||
QUARTERLY RESULTS
|
PARTICULARS |
|
|
|
31.03.2011 |
|
Type |
|
|
|
1st
Quarter |
|
Net Sales |
|
|
|
83407.700 |
|
Total Expenditure |
|
|
|
52739.000 |
|
PBIDT (Excl OI) |
|
|
|
30668.700 |
|
Other Income |
|
|
|
(17.400) |
|
Operating Profit |
|
|
|
30651.300 |
|
Interest |
|
|
|
2948.900 |
|
PBDT |
|
|
|
27702.400 |
|
Depreciation |
|
|
|
2981.600 |
|
Profit Before Tax |
|
|
|
24720.800 |
|
Tax |
|
|
|
7643.700 |
|
Profit After Tax |
|
|
|
17077.100 |
|
Net Profit |
|
|
|
17077.100 |
KEY RATIOS
|
PARTICULARS |
|
31.03.2011 |
31.03.2010 |
31.03.2009 |
|
PAT / Total Income |
(%) |
22.74 |
19.50 |
21.12 |
|
|
|
|
|
|
|
Net Profit Margin (PBT/Sales) |
(%) |
33.26 |
28.83 |
30.08 |
|
|
|
|
|
|
|
Return on Total Assets (PBT/Total Assets} |
(%) |
22.74 |
25.53 |
29.54 |
|
|
|
|
|
|
|
Return on Investment (ROI) (PBT/Networth) |
|
0.21 |
0.20 |
0.24 |
|
|
|
|
|
|
|
Debt Equity Ratio (Total Liability/Networth) |
|
0.84 |
0.93 |
0.30 |
|
|
|
|
|
|
|
Current Ratio (Current Asset/Current Liability) |
|
2.20 |
1.36 |
1.15 |
LOCAL AGENCY FURTHER INFORMATION
HISTORY
Subject is the world's 6th largest steel company.
It is a Asia's 1st and as well as
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
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
Golden Jubilee of the company was celebrated in the year 1958 and
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
Tata Steel's first step in the Global Market was when it acquired the steel
business of NatSteel Limited,
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
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.
TATA STEEL GROUP PERFORMANCE
Tata Steel Group steel deliveries at 23.5 million tonnes in
the financial year under review were at par with the financial year 2009-10
(23.6 million tonnes). The gross steel deliveries (including the inter-group
transfers) for the steel-producing entities were higher than the previous years
with Tata Steel India, Tata Steel Europe, NatSteel Holdings and Tata Steel
Thailand posting growth of 4%, 3%, 1% and 8% respectively. The company’s Indian
operations recorded a growth of 4% in steel deliveries from 6.17 million tonnes
in the financial year 2009-10 to 6.42 million tonnes in 2010-11.
Along with the increase in gross steel deliveries, the steel
producing entities witnessed increases in the average
realisations in line with the steep increase in the raw
material prices. The turnover for the Group in 2010-11 at Rs. 118,7530.000 Millions, was 16% higher than 2009-10 (Rs.102,3930.000 Millions). While the turnover in Tata Steel India witnessed a
growth of 17% from Rs.25,0220.000 Millions in
the financial year 2009-10 to Rs.29,3960.000 Millions in the financial year 2010-11, Tata Steel Europe’s
turnover increased by 15% from Rs.65,8430.000 Millions in the financial year 2009-10 to Rs.75,9910.000 Millions in the financial year 2010-11.
The Earnings before Interest, Taxes, Depreciation and Amortisation
(EBITDA) of the Group increased significantly from Rs.9,3400.00 Millions in the fiscal year 2009-10 to Rs.17,1030.000 Millions in the financial year 2010-11 primarily driven by the
increase in prices partly off set by the steep increase in input costs. Tata
Steel India recorded an EBITDA of Rs.12,2240.000 Millions in the financial year 2010-11 growing by 25% as compared
to Rs.9,8060.000 Millions in 2009-10.
Restructuring, impairment and disposals in the current year include Rs.
2,5030.000 Millions profit on disposal of
Teesside Cast Products at Tata Steel Europe.
Consequently, the Group turned around with a Profit after
Tax (after minority interest and share of profits of associates) for 2010-11 at
Rs.8,9830.000 Millions as compared to a loss of Rs.2,0090.000
Millions in 2009-10.
Indian Operations: Crude steel production at 6.86
million tonnes in financial year 2010-11 was higher than the previous year
(6.56 million tonnes) by 4%, thus exceeding the nameplate production capacity
in the second year on enhanced capacity. There was an increase in the vessel
life and heat size of the two steel melting shops enhancing their productivity
to achieve the higher crude steel production of the company. Saleable steel
also increased by 4% from 6.44 million tonnes recorded in financial year
2009-10 to 6.69 million tonnes in the financial year under review with higher
hot metal being available from the bigger blast furnaces with higher
productivity. The sales volume during the financial year 2010-11 at 6.42 million
tonnes was 4% higher as compared to the previous year (6.17 million tonnes)
indicating the robust growth in steel demand. Apart from the two steel melting
shops, there were many units (including mines and collieries) which surpassed
their respective best ever performances.
Ferro Alloys and Minerals division’s saleable production at
1,405k tonnes in the financial year 2010-11 was higher
than financial year 2009-10 (1,350k tonnes) by 4%. The sales
(including transfers to other divisions of the Company), however, at 1,464k
tonnes were lower than the previous year (1,508k tonnes) by 3%. Chrome alloys
exports and manganese alloys sales of the division touched new heights during
the financial year under review.
Improved demand in auto and infrastructure segments led to the increase
in sales and production in the Tubes division. The division recorded production
of 371k tonnes in FY 2010-11, higher by 6% over FY 2009-10 (351k tonnes), while
the sales improved from 349k tonnes in FY2009-10 to 366k tonnes in 2010-11, an
increase of 5%. Boosted by various improvement initiatives under ‘Kar Vijay Har
Shikhar’ programme, the division continued to improve on its performance in
various segments like ‘Tata Pipes’ (plumbing and irrigation), ‘Tata Structura’
(infrastructure) and Precision Tubes (Automotive, Process and Power sector).
Sales in the Bearings division in the financial year 2010-11 at 32.95
million numbers grew by 4% against the financial year 2009-10 (31.69 million numbers),
while the production at 33.14 million numbers in FY 2010-11 increased by 12%
over FY 2009-10 (29.61 million numbers). The increases were primarily driven by
higher demand in the domestic auto segment.
European operations: Sales volumes of Tata Steel Europe (TSE), excluding
seasonal effects, were reasonably flat for the first three quarters of the
financial year 2010-11, before showing an improvement in the last quarter to
the highest level of quarterly sales since financial year 2008-09. Deliveries
in Tata Steel Europe during FY 2010-11 (14.9 million tonnes) increased by 3%
over FY 2009-10 (14.4 million tonnes). Selling prices increased steadily
through the year with the revenue per tonne increasing by around 17% over the
previous year.
The revenue per tonne increased relatively sharply in the first quarter
of the financial year under review in anticipation of the equally sharp
increase in price of raw materials, but became more modest in the second and
third quarters before losing its upward momentum in the fourth quarter. Raw
material prices, in contrast, peaked during the third quarter.
TSE has adopted the Tata Steel identity for trading purposes with eff
ect from September 2010 and a progressive rebranding process is under way. The
Company has also adopted a new operating model to replace the previous model of
three main operating divisions (Strip Products, Long Products and Distribution
and Building Systems). It is now organised into a number of business activities
comprising steelmaking hubs (Strip Products Mainland Europe, Strip Products UK
and Long Products Europe), speciality businesses (Colours, Building Systems,
Packaging, Tubes, Kalzip, Plating, Cogent Power and Speciality Steel), and a
distribution and sales network (Distribution UK and Ireland, Distribution
Europe and International). TSE has adopted a single sales and marketing
function with eight industry-focused marketing sectors, namely
automotive, construction, packaging, rail, lifting and excavating, energy and
power, industry strip and industry long products. Europe, principally the EU,
continues to be the most important market of the Company.
On 24th February, 2011, Tata Steel UK Limited (TSUK), a subsidiary of
TSE, signed a defi nitive sale agreement to sell certain assets of TCP to
Sahaviriya Steel Industries Public Company Limited in a deal valuing the
business at Ł434 million. The assets covered by the sale include the Redcar
blast furnace, the Redcar and South Bank coke ovens, TCP’s power generation
facilities and sinter plant, and the Lackenby steelmaking and casting
facilities. The deal also includes TSUK and SSI entering into a joint venture
to operate Redcar wharf, TCP’s bulk terminal. The sale was completed on 24th
March, 2011.
The ‘Fit for the Future’ programme initiated in response to the
financial crisis continued to give results with notable reduction in the
average number of employees. The deal with SSI resulted in 850 employees
getting transferred to SSI and it is expected that further jobs will be
created.
South-East Asian operations: NatSteel recorded an increase in steel sales
by 1% in FY 2010-11 (1.80 million tonnes) over FY 2009-10 (1.78 million
tonnes). The increases were most noticeable in NatSteel Singapore, the
Australian units, Thailand and in trading business, while other business units
in China and Vietnam witnessed decline in their respective volumes. Nat Steel
Singapore increased its sales volume by 106k tonnes from 738k tonnes in FY
2009-10 to 844k tonnes in FY 2010-11. Average revenue per tonne improved across
all units (other than Australian units) thereby increasing the turnover of the
Company. The Company sold its share in an associate company Southern Steel
Berhard (SSB) during the financial year. The EBITDA of the Company, excluding
the profit on sale of share of SSB in the financial year under review, reduced
from the previous financial year primarily due to rise in the cost of input
materials which more than off set the increase in prices and impact of higher
sales volumes.
Sales volume of Tata Steel Thailand during FY 2010-11 at 1.29 million
tonnes was higher than FY 2009-10 (1.20 million tonnes) by 8%, while production
increased by 6% from 1.21 million tonnes in FY 2009-10 to 1.28 million tonnes
in FY 2010-11. During the financial year under review, the Company had to
mothball the Mini Blast Furnace in the third quarter due to high costs of
operations and low capacity utilisation, before recommencing its operations in
the fourth quarter. The company incurred losses during the year primarily due
to high costs of operations, low capacity utilisation and losses due to
mothballing of the Mini Blast furnace partly compensated by increase in average
revenue per tonne and higher sales volume.
SUBSIDIARIES
The consolidated financial statements presented by the
Company include financial information of its subsidiaries
prepared in compliance with applicable Accounting Standards.
The Ministry of Corporate Affairs, Government of
India vide its Circular No. 5/12/2007-CL-III dated 8th
February, 2011 has granted general exemption under Section 212(8) of the
Companies Act, 1956, from attaching the balance sheet, profit and loss account
and other documents of the subsidiary companies to the balance sheet of the
Company, provided certain conditions are fulfilled. Accordingly, annual
accounts of the subsidiary companies and the related detailed information will
be made available to the holding and subsidiary companies’ investors seeking
such information at any point of time. The annual accounts of the subsidiary companies
will also be kept for inspection by any investor at its Head Office in Mumbai
and that of the subsidiary companies concerned.
MANAGEMENT DISCUSSION AND ANALYSIS
INDUSTRY STRUCTURE:
Global Steel industry: Global crude steel production
reached a new height during 2010 at 1,414 million metric tonnes, up by 15% over
2009. While China maintained the lead position in terms of volume of steel
produced, with a growth of 9.3%, most of the negative growths seen in the steel
producing nations hit by the economic downturn in 2009 reversed during 2010 and
they recorded positive double digit growths during the year. The following
table shows the crude steel production volume of the top ten steel producing
nations:
In Asia, the annual production at 897.9 million tonnes in 2010 was up by
11.6% from 2009. The EU registered a growth of 24.5% over 2009 producing 172.9
million tonnes of crude steel in 2010. However, production in the UK (2010: 9.7
million tonnes, 2009: 10.1 million tonnes) and Greece (2010: 1.8 million
tonnes, 2009: 2.0 million tonnes) continued to decline over previous years. The
CIS countries recorded increase of 11.2% with a production volume of 108.5
million tonnes of crude steel in 2010 with Russia and Ukraine as the major
contributors.
In 2010, Tata Steel ranks 11th among the top 12 steel makers of the
world in terms of crude steel production. Most of the international steel
companies witnessed a bounce back in their production level from the drops they
experienced from the crisis of 2009. However, in many cases these companies
could not reach their pre-crisis
production levels. Chinese companies dominate the list with 7 of the top
12 being Chinese companies. The largest gainers in terms of percentage increase
over 2009 production were ThyssenKrupp (52%), US Steel (46%), Nippon Steel,
JFE, Nucor and Gerdau (all registering more than 30% increase).
The Japanese crisis in March 2011 has caused some uncertainty over raw
material prices and short-term end-user steel demand, although there is likely
to be a medium-term increase in demand from reconstruction activity. In
particular, the automotive and electronics industries may face shortages in
supply where they are relying on Japan for manufacturing components.
Steel Industry in India:
Ranked 5th in terms of crude steel production in the steel
producing countries, the country’s production grew by around 6% in 2010 over
2009. There has been a diversification in the product mix of the steel industry
in India to include sophisticated value-added steel used in the automotive
sector, heavy machinery and physical infrastructure. However, the industry is
suffering from high ash content of domestic coal and is dependent on supply of
imported coal. The bottlenecks for green field expansion of the country are raw
material security (getting iron ore mining lease), infrastructure (affecting
logistics and transport), and uncertainties in land acquisition. 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 2010-11
when compared with the previous financial year.
Steel consumption for FY 2010-11 for the flat products and
long products grew by 6.7% and 10.6% respectively with flat products exports
growing by 1.8%, while there was a decline of 33.7% in the exports of long
products. There was a reduction in the imports of flat products and long
products by 3.8% and 23.6% respectively. The steel prices during the financial
year 2010-11 have increased from the average prices prevailing in the previous
financial year as well as the quarter ended March 2010 driven primarily by the
increase in the prices of input raw
materials during the same period.
UK and European Steel Industry: Consequent
to the collapse in demand in 2009, the crude steel production in the European
Union (27) increased by 24.5% from 138.8 million tonnes in 2009 to 172.9
million tonnes in 2010. Imports of steel by EU were higher by 27% from 22
million tonnes in 2009 to 27.9 million tonnes in 2010. Russia remained the
largest supplier of steel (24%) to the EU at 6.8 million tonnes, while 20% of
the imports were from Ukraine (5.6 million tonnes) and imports from China were
3.9 million tonnes (14%). The product mix in the imports changed with more of
flat products as compared to long products. EU exports however increased by
8.4% to 34.3 million tonnes with Turkey being the largest market (4.5 million
tonnes – 13%) followed by the USA (3.7 million
tonnes –11%) and Algeria (3 million tonnes – 8%).
South-East Asian Steel industry: As per
the preliminary numbers obtained by South East Asia Iron and Steel
Institute (SEAISI), the steel
consumption in the Association of South-East Asian Nations (ASEAN) at 47.3 million
tonnes in 2010 grew by 14% over 2009 and was higher by 1.3 million tonnes over
the pre-crisis level of 2008. While production in the area at 26 million tonnes
was higher than 2009 by 6%, imports grew significantly by 25% over 2009 to be
at around 30 million tonnes. Exports volume at 8 million tonnes also witnessed
an increase of 26% over 2009.
In Thailand, the increase in consumption was met by
60% higher imports (8 million tonnes) while the domestic steel output grew
moderately by 8% to around 7.5 million tonnes with exports increasing by 0.4
million tonnes to 1.6 million tonnes. The Steel demand in Indonesia was
met substantially by imports with domestic output at 5.1 million tonnes and
exports rising by 22% to be at 1.3 million tonnes. Philippines demand
growth was met mostly by imports (1.8 million tonnes) with stagnation in the
domestic output and decline in exports. Similar situation was witnessed in Malaysia
with an increase in imports (at 4 million tonnes) and decline in domestic
production and exports. Vietnam steel demand declined by 1.8% in
contrast to growth in the domestic output by 20% to 5.6 million tonnes to serve
the export market. In Singapore, long product consumption declined by 4%
from 1.83 million tonnes to 1.75 million tonnes mainly on account of completion
of mega projects. In spite of a drop in the domestic long product output of the
country, NatSteel managed a growth of 9% catering to exports market which grew
from 0.29 million tonnes to 0.49 million tonnes. Flat product demand in
Singapore fell by 6% to below 0.9 million tonnes.
Tubes division:
During FY 11, Tubes Division consolidated its position in the market
place by registering a growth in production and sales by 6% and 5% respectively
enabled by successful implementation of various improvement initiatives, under
‘Kar Vijay Har Shikhar’. The key performance highlights of the division are
appended below:
·
‘Tata Pipes’ continues to be one of the leading
players in India in the conveyance business for the plumbing and irrigation
segments. During FY 11 it has also made forays in the HVAC (Heating,
Ventilating and Air-conditioning) segment and provided value added services
through its channel partners.
·
‘Tata Structura’ is supplied to the infrastructure
segment. This sector grew by 15% in FY 11 achieving a landmark of 0.1 million tonnes with its presence in the
upcoming airports of Chennai and Kolkata.
·
Precision Tubes are supplied to the Automotive, Process
and Power sector. During FY 11, the production and sales of Precision Tubes
grew by 13% each over the previous year using future focussed practices like
EVI (Early Vendor Involvement), NPD (New product Development) and PAG (Product
Application Group). The Tubes Division won the Coveted JRD QV Award in the
year. Along with long products, the division also won the EPC World Award 2010.
OUTLOOK:
As reported by the ‘World Economic Outlook’ (WEO) issued by the
International Monetary Fund in April 2011, the world economy is expected to
grow at 4.5% in the years 2011 as well as 2012. The advanced economies are
projected to grow at 2.5% while the emerging and developing economies will be
growing at a higher level of 6.5%.
The recovery from the global economic downturn remains unbalanced. In
the advanced economies, output is far below potential and the unemployment
continues to be high, with a risk of having a lower growth in these economies
fuelling the unemployment issue further. In the US, the fiscal consolidation is
ongoing with the housing market remaining depressed. In Japan, the immediate
focus is on reconstruction and there will be an effort to link the
reconstruction spending to a fiscal strategy to bring down the public debt
ratio over the medium term. In the EU, recovery is proceeding in a modest pace
with the output still below potential and unemployment high. WEO reports that
Germany and France are expected to grow at 2.5% and 1.5% respectively during
2012 while rapid growth is expected to continue in Asia with a growth
projection of 6.7% in 2011 and 6.8% in 2012. China and India, as a part of the
developing Asia are set to grow at 9.6% and 8.2% respectively during 2011 and
9.5% and 7.8% in 2012 with private demand growing in China while infrastructure
remains a key contributor to growth in India.
The World Steel Association (WSA) in its short range outlook issued in
April 2011 states that the world consumption of steel is expected to be 1.359
billion tonnes in 2011 registering a growth of 6% over 2010, following a growth
of 13.2% growth in 2010. Steel demand is expected to grow further by 6% to
1.441 billion tonnes in 2012.
The forecast of WSA suggests that the steel demand in China in 2011 is
set to rise by 5% to 605 million tonnes while that in India it is expected to
reach 68.7 million tonnes, registering a growth of 13.3%. In 2012, China is
expected to maintain the growth of 5% while India is expected to accelerate by
14.3%. The recovery in the US estimated to lead the steel consumption to 13%
growth to be at 90.5 million tonnes with the construction market remaining
weak. The forecast of steel consumption in Japan is yet to be firmed up after
the tragic earthquake and Tsunami. Apparent steel use in the EU is forecast to
grow by 4.9% in 2011 to be at 151.8 million tonnes with Germany and France the
leading economies which are expected to lead the steel use recovery
particularly in the automotive and machine building sectors.
FINANCE:
In FY 11, the world emerged from the depths of the financial crisis as
most economies moved out of technical recession or negative growth. Governments
and monetary bodies, through large fiscal spending, zero interest rate policies
and easy credit have averted the possibility of mass banking collapse and
financial crisis. The developed world has now entered a period of slow and
uncertain growth, which cannot be accelerated by relying on the same policies
without creating a fresh crisis in the shape of sovereign defaults and an
inflationary spiral. Emerging markets which have robust growth are importing
inflation from the rest of the world and though they are raising interest
rates, local monetary tightening has been of limited benefit so far.
During the financial crisis, the Company had focused on raising
additional debt in order to maintain a liquidity buffer given the uncertain
nature of the steel markets. However, given the lower level of earnings and
increased debt, the leverage position of the Company had become sub-optimal.
Therefore in FY 11, the Company continued on its journey of deleveraging. It
repaid `Rs.4,2580.000 Millions of borrowings during the year.
At the same time, given the substantial improvement in liquidity in
financing markets, the Company in FY 11 refinanced the entire acquisition debt
in Tata Steel Europe. Tata Steel UK Holdings, on 29th September, 2010, signed a
Senior Facility Agreement with a syndicate of 13 banks for a Ł3.53 billion term
loan and revolving credit facility which replaced in full the term loan and
revolving credit facilities entered into at the time of the acquisition of
Corus Group plc in 2007. The new facilities have been designed to achieve
certain key financing and business objectives for the company: the syndicate
comprises a smaller, co-ordinated group of Banks with long-term relationships
with Tata Steel; repayment obligations for the next 5 years have been
minimised; there is flexibility to incur higher capital expenditure in Europe
and to raise working capital depending on business needs; and the new financing
arrangements carry lighter financial covenant obligations.
However, given the business environment and earnings profile of the
Company, there was a need for a further rebalancing of the capital structure.
This needed to be achieved by a combination of disposals of non-core assets,
raising of equity and quasi equity funds. The Company is continuing to dispose
of stake in other Tata Group Companies which are unrelated to its business. In
addition, the Company completed the sale of the Teesside Cast Products unit of
Tata Steel Europe in a deal valuing the business at around Ł434 million in
March 2011 and 51% of its 77.46% stake in Tata Refractories Limited in a deal
valuing the equity of TRL at Rs.1,1300.000 Millions in April 2011. In January
2011, the Company completed a further public offer for ordinary shares in the
domestic markets
aggregating Rs. 3,4770.000 Millions. In December 2010 and January 2011,
it drew Rs. 3,0000.000 Millions via issuance of 20 year Non-Convertible
Debentures, where the Company will have no cash outgo on account of interest
for the first 3 years. In March 2011, the Company also successfully completed
India’s first ever off erring of Corporate Hybrid Securities with an issuance
of Rs.1,5000.000 Millions (US$ 332 million). These securities rank senior only
to share capital,
are perpetual in nature with no maturity or redemption and are callable
only at the option of the Company thereby incorporating equity characteristics.
As part of the financing of the imports for the 2.9 mtpa expansion in
Jamshedpur, the Company also tied up long-term ECA backed buyer’s credit of
€72.85 million to be drawn over the next 18 months and repaid over the next ten
years. As on 31st March, 2011, the cash and cash equivalent in Tata Steel
Limited, India was ` 4,142 crores and Rs.10,893.000 Millions for the Group.
FINANCIAL PERFORMANCE:
Tata Steel Standalone:
Profit after tax at Rs.6,86.600 Millions during the financial year
2010-11 was higher by 36% as compared to the financial year 2009-10
(Rs.5,0470.000 Millions). The diluted earnings per share was at ` 70.99 for FY
11 (FY 10: ` 57.31) while the basic earnings per share for FY 11 was at ` 75.63
(FY 10: ` 60.26).
Steel sales volume during FY 11 at 6.42 million tonnes recorded an
increase of 4% over FY 10 (6.17 million tonnes). Higher prices across all
divisions and higher volumes in Tubes, Wires and Bearings divisions also
contributed to the increase in net sales.
PRESS RELEASE
Mumbai – 11.01.2011
Tata Steel wins the 'The Businessworld Most Respected Company Award 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
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
CMT REPORT (Corruption, Money Laundering & Terrorism]
The Public Notice information has been collected from various sources
including but not limited to: The Courts,
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 records 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 :
Our 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.
Our 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.48.91 |
|
|
1 |
Rs.76.53 |
|
Euro |
1 |
Rs.66.43 |
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 |
- |
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.