Analysis of Tata Steel Group
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Analysis of Tata Steel Group

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This is an amateur analysis of Tata Steel by me for a course called "Value Engineering" which is a part of the curriculum of "Industrial Engineering and Management"

This is an amateur analysis of Tata Steel by me for a course called "Value Engineering" which is a part of the curriculum of "Industrial Engineering and Management"

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  • Good morning everyone.
  • Well.. A quick glance at some facts.
  • This is the portrait of the founder of the Tata group, JN Tata
  • Talk about sap
  • Talk about demming
  • This is the list of the board of directors of the compnay. The board has 13 members out of which 2 are executive directors.More than half of the board ie. 7 members are independent directors.Ratan Tata used to be the chairman of the board until his retirement in December last year. Now he is the Chairman Emeritus which is an honorary post
  • This is the list of the subsidiaries of the company. The company has made 3 major acquisitions namely Corus, Millennium Steel and Nat Steel.. The buyout of corus was the biggest by any indian company ever.. It has changed the history of the company and that is why it is highlighted..
  • Now we are gonna do the financial analysis of the company.Balance sheet and profit and loss statement are two important statements which we are goin to use for the analysis. And nw I will tell u briefly what these two are.
  • Balance sheet represent company’s financial position at particular pt. of time. Its consists of assets , liabilities & capital of company or organisation.
  • Assets are the THINGS OF VALUE OWNED BY THE COMPANY , IT CAN BE IN THE FORM OF LAND ON WHICH THE COMPANY HAS BEEN BUILT, OR THE RAW MATERIAL THAT COMPANY HAS ON ITS SHOPFLOOR.Amount owed by an entity , which represents a claim by outsiders which include banks , financial institutes, is referred to as liabilities. In simple words, Its all about value payable by the company.AS you can see here,This is the balance sheet equation that gives the net worth of a company.Profit that a company makes in a year also adds to the the net worth of a company.
  • Revenue and expenses are mentioned in the profit and loss statement and the difference between them give us the profit or the loss or the net earning of the company in the particular financial period.
  • i will explain the various types of profits in a profit loss statementWhen we subtract the cost of goods sold frm the sales, we get the gross profit.Frm the gross profit when we subtract the operating expenses we get operating profitAnd finally after subtracting non operating expenses, depriciation, interest and tax we finally get net profit/profit aftr tax.
  • If a subsidiary earned $1 in income, for example, that $1 would show up on the parent's consolidated statement and the subsidiary's stand-alone statement -- but not the parent's stand-alone statement.
  • Debt has been pretty much constant… but networth has been increasing
  • Investments hav been growing… total assets have been growing.. These are the investments in the subsidaries
  • The debt factor is very high…
  • NOW LETS TALK ABOUT SHARE HOLDING PATTERN OF THE COMPANYFIRST PROMOTER AND PROMOTER GROUP WHICH IS TATASSECOND PUBLIC INSTITUTIONAL BANKS AND FINANCIAL INSTITUTESTHIRD PUBLIC NON INSTITUTIONAL ARE COMMON PUBLIC 
  • TATA SONS LTD. IS THE HOLDING COMPANY OF TATA GROUP THESE OTHERS ARE THE GROUP COMPANIES ,THERE ARE TWO TRUSTS – SRI DORABJI TATA AND RATAN TATA TRUST WHICH WERE CREATED BY THE FAMLIES OF SONS OF JAMSETJI TATA, WHO WAS THE GROUP FOUNDER OF TATA SONS
  • NOW I WOULD LIKE TO DISCUSS THE FACTORS AFFECTING SHARE PRICE OF A COMPANY.
  • SOME PART OF EARNING BECAUSE SHARE PRICE is the price you are willing to pay for the future stream of earnings.
  • THIS SHOWS THAT STOCK PRICE IS HIGH WHEN THE EARNING PER SHARE IS LOW
  • As buyers move into the market, demand grows faster than supply and the price goes up.  More sellers than buyers means there is more supply than demand, so the price falls.
  • Technical factors are the mix of external conditions that alter the supply of and demand for a company's stocklow inflation drives high multiples and high inflation drives low multiples 1) middle-aged investors, who are peak earners that tend to invest in the stock market, and 2) older investors who tend to pull out of the market in order to meet the demands of retirement.
  •  Crowd psychology, typically a measurement of bullish or bearish attitudes among investors and trader.
  • an estimation of the value of a business that is obtained by multiplying the number of shares outstanding by the current price of a share.
  • THIS IS THE MARKET CAP. COMPARISION WITH THE PEERS
  • TATA STEEL IS LISTED IN BOMBAY STOCK EXCHANGE ,NSE AND LUSEMBURG STOCK EXCHAMGE OF EUROPE
  • THIS IS A SHARE PRICE CHART ,IN WHICH BLUE COLOUR SHOWS THE TREND OF TATA STEEL,ORANGE COLOUR SHOWS THE TREND OF NIFTY,IN THIS CHART THERE IS SO MANY PEAKS AND VALLEY S IN SHARE PRICE,SOME OF THEM ARE DUE TO FUNDAMENTAL FACTORS OR TECHNICAL FACTORS OR MARKET SENTIMENTSAFTER AUGUST 2007, THERE WAS A PEAK IN SHARE PRICE THIS IS BECAUSE COMP. AQUIREd CORUS IN EUROPE AND WHICH MAde TATA STEEL the SIXTH LARGEST STEEL PRODUCER IN THE WORLD AND THE COMPANY’S TURNOVER FIGURE BECame 5 TIMES than THE LAST YEAR AND THERE IS VALLEY IN 2008 ,THIS was BECAUSE OF RECESSION IN THE WORLD…….AND IN THIS ZONE THERE IS A HUGE RECESSION IN EUROPE AND SLUMP IN THE WORLD STEEL MARKET THAT LOWERS THE MARKET CAP.AND IN LAST TO THREE YEARS THE COMPANy’s PROFIT IS ALSO LESS DUE TO THE DEBT’S which has lowerd down the SHARE PRICE .
  • THIS IS THE OVERALL SHARE PRICE CHART OF THE COMPANY FROM 2000 TO 2013

Analysis of Tata Steel Group Analysis of Tata Steel Group Presentation Transcript

  • Value Engineering ANALYSIS OF THE FINANCIALS OF A COMPANY Avinash Kumar Rai Aakash Saluja Bhavuk Singla Aaditya Nagpal
  • TATA STEEL- A BRIEF INTRO • Indian multi-national steel company headquartered in Mumbai • Among top 10 global steel companies with annual crude steel capacity of over 28 million tonnes per annum (mtpa) • Ranked 401st in the 2012 Fortune Global 500 ranking • Has manufacturing operations in 26 countries, including Australia, China, India, the Netherlands, Singapore, Thailand and the United Kingdom, and commercial presence in about 50 countries • Employs about 81,000 people • Part of the prestigious TATA GROUP • The largest plant of the company is located in Jamshedpur, India (6.8mtpa)
  • HISTORICAL TIMELINE • 1907-1908 The town of Sakchi is discovered which is to be the place where the 1st steel plant of India would be located and the construction work begins and the TATA IRON AND STEEL COMPANY is formed. • 1911-1912 The first blast furnace went into operation successfully and the first ingot of steel rolled out of the Sakchi Plant amidst much rejoicing • 1937 Retiring Gratuity Scheme was launched • 1941 manufacture of special steel for war purpose was commenced
  • • 1980 First phase of the four- phased modernisation programme started • 1999 SAP was introduced • 2002 Tata Steel was conferred the Prime Minister's Trophy for the Best Integrated Steel Plant for the third consecutive year and four times in all • 2007 Integration of Tata Steel and Corus was accomplished at US $ 12 billion, making Tata Steel one among the top ten steel producers globally and the second-most geographically diversified steel producer in the world
  • • 2005 The name of the company was changed from Tata Iron and Steel company to Tata Steel Limited • 2008 Indian Prime Minister Dr. Manmohan Singh unveils the Centenary Postage Stamp, to commemorate Tata Steel's Centenary year • 2008 The company won the Deming Application Prize • 2012 Tata Steel became the first steel company to win the Deming grand prize
  • BOARD OF DIRECTORS Cyrus P. Mistry Non Executive Chairman of the Board B. Muthuraman Non Executive Vice-Chairman H.M. Nerukar Managing Director & CEO Ishaat Husain Non Executive Director Karl-Ulrich Köhler Non Executive Director Koushik Chatterjee Finance Director Independent Directors Nusli Neville Wadia Subodh Bhargava Jacobus Schraven Andrew Robb Mallika Srinivasan D. K. Mehrotra OP Bhatt Ratan N. Tata Chairman Emeritus
  • SUBSIDIARIES Major International Acquisitions : • Tata Steel Europe (formerly Corus PLC in 2007) • Tata Steel Thailand (formerly Millennium Steel in 2005) • Nat Steel Holdings, Singapore (in 2004) Other Subsidiaries : • Tata Sponge Iron Limited • Tata Metaliks • Tata Steel KZN Pte Limited • TRL Krosaki Refractories Limited • The Tinplate Company of India Limited • Tata Steel Processing & Distribution Limited
  • BALANCE SHEET PROFIT & LOSS STATEMENT
  • BALANCE SHEET The balance sheet is a summary of the financial position of an organisation at a particular point of time. This position is conveyed by listing all the things of value (assets) owned by the organisation on one side and the payables owed by the organisation on the other side.
  • THE BALANCE SHEET EQUATION NET WORTH = ASSETS - LIABILITIES
  • PROFIT AND LOSS STATEMENT (Income Statement) An orderly list of all the revenues and all the expenses at the end of the financial period . The difference between revenues and expenses gives an estimate of the profit or loss of the period i.e. the net earnings of the business.
  • CONTENTS OF PROFIT & LOSS STATEMENT Sales (or revenue) less : cost of goods sold Gross profit less operating expenses Operating profit less: non operating expenses Profit before interest and tax (PBIT) Less: interest Profit before tax(PBT) Less : tax Profit after tax (PAT) Add : previous year’s balance of P&L A/C Profit available for distribution Less : appropriations Retained earnings
  • CONSOLIDATED AND STANDALONE STATEMENTS • CONSOLIDATED FINANCIAL STATEMENT A consolidated financial statement covers the activities of the parent company and its subsidiaries in a single report, as if they were all a single company operating under one roof. • STAND-ALONE FINANCIAL STATEMENT Stand-alone financial statements, by contrast, treat each entity as if it were entirely separate -- the parent unrelated to the subsidiaries, and the subsidiaries unrelated to one another.
  • DETAILED ANALYSIS OF THE FINANCIALS
  • A STEEL MULTINATIONAL
  • GEAGRAPHICAL DISTRIBUTION OF REVENUE INDIA [27%] ASIA (excluding INDIA) [13%] UK [26%] EU (excluding UK) [29%] REST OF THE WORLD [5%]
  • STANDALONE BALANCE SHEET LIABILITIES SIDE Mar '13 Mar '12 Mar '11 Mar '10 Mar '09 Mar '08 Mar '07 Mar '06 Mar '05 Mar '04 SOURCES OF FUNDS Total Share Capital 971.41 971.41 959.41 887.41 6,203.45 6,203.30 580.67 553.67 553.67 369.18 Equity Share Capital 971.41 971.41 959.41 887.41 730.79 730.78 580.67 553.67 553.67 369.18 Share Application Money 0 0 178.2 0 0 0 147.06 0 0 0 Preference Share Capital 0 0 0 0 5,472.66 5,472.52 0 0 0 0 Reserves 54,238.27 51,245.05 47,307.02 36,281.34 23,501.15 21,097.43 13,368.42 9,201.63 6,506.25 4,146.68 Revaluation Reserves 0 0 0 0 0 0 0 0 0 0 NETWORTH 55,209.68 52,216.46 48,444.63 37,168.75 29,704.60 27,300.73 14,096.15 9,755.30 7,059.92 4,515.86 Secured Loans 2,036.02 1,919.27 2,013.00 2,259.32 3,913.05 3,520.58 3,758.92 2,191.74 2,468.18 3,010.16 Unsecured Loans 23,875.49 21,774.55 26,288.14 22,979.88 23,033.13 14,501.11 5,886.41 324.41 271.52 363.12 TOTAL DEBT 25,911.51 23,693.82 28,301.14 25,239.20 26,946.18 18,021.69 9,645.33 2,516.15 2,739.70 3,373.28 TOTAL LIABLITIES 81,121.19 75,910.28 76,745.77 62,407.95 56,650.78 45,322.42 23,741.48 12,271.45 9,799.62 7,889.14
  • STANDALONE BALANCE SHEET ASSETS SIDE Mar '13 Mar '12 Mar '11 Mar '10 Mar '09 Mar '08 Mar '07 Mar '06 Mar '05 Mar '04 APPLICATION OF FUNDS Gross Block 38,531.91 23,485.63 22,846.26 22,306.07 20,057.01 16,479.59 16,029.49 15,407.17 13,085.07 12,505.83 Less: Accum. Depreciation 13,656.86 12,119.37 11,041.16 10,143.63 9,062.47 8,223.48 7,486.37 6,699.85 5,845.49 5,411.62 NET BLOCK 24,875.05 11,366.26 11,805.10 12,162.44 10,994.54 8,256.11 8,543.12 8,707.32 7,239.58 7,094.21 Capital Work in Progress 8,722.29 18,506.63 6,969.38 3,843.59 3,487.68 4,367.45 2,497.44 1,157.73 1,872.66 763.64 INVESTMENTS 50,418.80 50,282.52 46,564.94 44,979.67 42,371.78 4,103.19 6,106.18 4,069.96 2,432.65 2,194.12 Inventories 5,257.94 4,858.99 3,953.76 3,077.75 3,480.47 2,604.98 2,332.98 2,174.75 1,872.40 1,249.08 Sundry Debtors 796.92 904.08 428.03 434.83 635.98 543.48 631.63 539.4 581.82 651.3 Cash and Bank Balance 2,218.11 30.82 512.76 500.3 463.58 465 446.51 288.35 246.68 250.54 Total Current Assets 8,272.97 5,793.89 4,894.55 4,012.88 4,580.03 3,613.46 3,411.12 3,002.50 2,700.90 2,150.92 Loans and Advances 9,587.82 6,935.20 16,814.04 6,678.55 5,884.61 34,582.84 4,025.95 1,994.46 2,234.96 2,782.49 Fixed Deposits 0 3,918.93 3,628.78 2,733.84 1,127.02 0.04 7,234.84 0.04 0.04 0.2 Total CA, Loans & Advances 17,860.79 16,648.02 25,337.37 13,425.27 11,591.66 38,196.34 14,671.91 4,997.00 4,935.90 4,933.61 Deffered Credit 0 0 0 0 0 0 0 0 0 0 Current Liabilities 17,098.06 16,975.61 10,383.04 8,699.34 8,965.76 6,842.26 6,349.24 4,552.39 4,247.43 3,908.93 Provisions 3,657.68 3,917.54 3,547.98 3,303.68 2,934.19 2,913.52 1,930.46 2,361.44 2,648.56 3,343.48 Total CL & Provisions 20,755.74 20,893.15 13,931.02 12,003.02 11,899.95 9,755.78 8,279.70 6,913.83 6,895.99 7,252.41 NET CURRENT ASSETS -2,894.95 -4,245.13 11,406.35 1,422.25 -308.29 28,440.56 6,392.21 -1,916.83 -1,960.09 -2,318.80 Miscellaneous Expenses 0 0 0 0 105.07 155.11 202.53 253.27 214.82 155.97 TOTAL ASSETS 81,121.19 75,910.28 76,745.77 62,407.95 56,650.78 45,322.42 23,741.48 12,271.45 9,799.62 7,889.14
  • CONSOLIDATED BALANCE SHEET LIABILITIES SIDE Mar '13 Mar '12 Mar '11 Mar '10 Mar '09 Mar '08 Mar '07 Mar '06 Mar '05 Mar '04 SOURCES OF FUNDS Total Share Capital 992.62 993.84 958.74 886.74 6,202.78 6,202.63 580 553 552.27 368.24 Equity Share Capital 971.41 971.41 958.74 886.74 730.12 730.11 580 553 552.27 368.24 Share Application Money 0 17.46 195.66 17.46 17.46 17.46 164.52 0 2.1 0 Preference Share Capital 21.21 22.43 0 0 5,472.66 5,472.52 0 0 0 0 Reserves 33,200.83 41,644.81 35,926.97 22,134.10 21,039.84 27,971.35 13,895.14 9,728.84 6,782.79 4,288.44 Revaluation Reserves 0 0 0 0 0 0 0 0 0 0 NETWORTH 34,193.45 42,656.11 37,081.37 23,038.30 27,260.08 34,191.44 14,639.66 10,281.84 7,337.16 4,656.68 Secured Loans 24,701.81 27,482.74 28,604.40 28,059.33 34,329.26 35,415.22 4,961.23 2,502.74 2,668.11 3,111.75 Unsecured Loans 32,545.37 24,729.58 32,079.94 25,041.02 25,571.24 18,177.53 19,964.30 874.69 647.52 386.2 TOTAL DEBT 57,247.18 52,212.32 60,684.34 53,100.35 59,900.50 53,592.75 24,925.53 3,377.43 3,315.63 3,497.95 Minority Interest 1,669.36 1,091.15 888.9 884.07 894.88 832.7 598.39 123.57 93.52 48.66 Policy Holders Funds 0 0 0 0 0 0 0 0 0 1,581.81 TOTAL LIABILITIES 93,109.99 95,959.58 98,654.61 77,022.72 88,055.46 88,616.89 40,163.58 13,782.84 10,746.31 9,785.10
  • CONSOLIDTED BALANCE SHEET ASSETS SIDE Mar '13 Mar '12 Mar '11 Mar '10 Mar '09 Mar '08 Mar '07 Mar '06 Mar '05 Mar '04 APPLICATION OF FUNDS Gross Block 148,329.94 129,093.78 113,399.58 111,830.82 114,823.59 114,279.31 20,303.44 16,744.68 14,129.27 13,606.70 Less: Accum. Depreciation 79,837.87 69,638.85 61,592.15 60,812.60 63,083.16 63,162.42 9,189.62 7,199.99 6,206.39 5,589.06 NET BLOCK 68,492.07 59,454.93 51,807.43 51,018.22 51,740.43 51,116.89 11,113.82 9,544.69 7,922.88 8,017.64 Capital Work in Progress 13,786.15 20,039.71 15,884.17 9,319.43 8,930.07 8,896.19 3,326.37 1,357.41 1,896.04 0 INVESTMENTS 3,257.66 4,021.25 7,847.34 5,417.79 6,411.10 3,367.43 16,497.50 3,478.90 2,594.18 2,254.97 Inventories 24,091.19 25,598.00 24,055.24 18,686.64 21,668.70 23,064.34 3,888.13 2,773.31 2,489.90 1,374.04 Sundry Debtors 13,993.96 14,878.48 14,816.28 11,623.95 13,031.63 18,696.32 1,686.53 1,218.72 1,324.07 756.06 Cash and Bank Balance 9,859.67 10,801.58 10,892.60 6,787.81 6,148.36 4,231.64 10,887.96 776.75 465.73 277.87 Total Current Assets 47,944.82 51,278.06 49,764.12 37,098.40 40,848.69 45,992.30 16,462.62 4,768.78 4,279.70 2,407.97 Loans and Advances 13,425.72 12,001.92 10,180.08 6,884.24 13,098.66 19,390.88 2,970.68 1,906.84 1,592.36 687.7 Fixed Deposits 0 39.39 0 0 0 0 0 0 0 0 Total CA, Loans & Advances 61,370.54 63,319.37 59,944.20 43,982.64 53,947.35 65,383.18 19,433.30 6,675.62 5,872.06 3,095.67 Deffered Credit 0 0 0 0 0 0 0 0 0 0 Current Liabilities 45,496.70 42,790.58 29,738.61 25,157.53 24,878.85 32,764.79 7,219.31 5,052.25 5,139.67 3,211.23 Provisions 8,299.73 8,085.10 7,089.92 7,557.83 8,200.12 7,537.64 3,197.87 2,477.54 2,617.42 528.05 Total CL & Provisions 53,796.43 50,875.68 36,828.53 32,715.36 33,078.97 40,302.43 10,417.18 7,529.79 7,757.09 3,739.28 NET CURRENT ASSETS 7,574.11 12,443.69 23,115.67 11,267.28 20,868.38 25,080.75 9,016.12 -854.17 -1,885.03 -643.61 Minority Interest 0 0 0 0 0 0 0 0 0 0 Miscellaneous Expenses 0 0 0 0 105.48 155.63 209.77 256.01 218.24 156.1 TOTAL ASSETS 93,109.99 95,959.58 98,654.61 77,022.72 88,055.46 88,616.89 40,163.58 13,782.84 10,746.31 9,785.10
  • NET WORTH 0 10000 20000 30000 40000 50000 60000 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 STANDALONE CONSOLIDATED Rs. Crores
  • TOTAL DEBT 0 10000 20000 30000 40000 50000 60000 70000 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 STANDALONE CONSOLODATED Rs. Crores
  • STANDALONE P&L ACCOUNT (Page 1) Mar '13 Mar '12 Mar '11 Mar '10 Mar '09 Mar '08 Mar '07 Mar '06 Mar '05 Mar '04 INCOME Sales Turnover 42,317.24 37,005.71 31,901.94 26,757.60 26,843.53 22,191.43 19,756.84 17,136.92 15,867.62 11,917.88 Excise Duty 4,117.81 3,167.20 2,594.59 1,816.95 2,495.21 2,537.02 2,304.18 2,004.83 1,377.92 1,218.57 Net Sales 38,199.43 33,838.51 29,307.35 24,940.65 24,348.32 19,654.41 17,452.66 15,132.09 14,489.70 10,699.31 Other Income 227.51 923.42 1,435.80 1,241.08 603.07 586.41 362.12 252.58 108.75 7.63 Stock Adjustments 404.6 220.72 173.65 -134.97 289.27 38.73 82.47 104.91 289.55 64.46 TOTAL INCOME 38,831.54 34,982.65 30,916.80 26,046.76 25,240.66 20,279.55 17,897.25 15,489.58 14,888.00 10,771.40 EXPENDITURE Raw Materials 12,421.63 9,917.37 9,395.92 8,356.45 8,568.71 6,063.53 5,762.42 4,766.44 4,578.43 3,456.28 Power & Fuel Cost 2,510.17 1,990.16 1,558.49 1,383.44 1,222.48 1,038.77 1,027.84 897.57 778.3 724.62 Employee Cost 3,608.52 3,047.26 2,618.27 2,361.48 2,305.81 1,589.77 1,454.83 1,351.51 1,291.00 1,349.59 Other Manufacturing Expenses 1,381.08 3,618.22 2,905.16 2,419.89 2,127.48 1,654.96 1,561.40 1,466.83 1,440.72 1,130.30 Selling and Admin Expenses 0 2,383.34 574.86 417.9 400.24 247.77 244.92 255.93 259.74 273.55 Miscellaneous Expenses 8,432.52 1,568.62 1,456.83 1,287.04 1,180.08 1,029.30 805.99 727.12 679.86 509.78 Preoperative Exp Capitalised -876.13 -478.23 -198.78 -326.11 -343.65 -175.5 -236.02 -112.62 -204.82 -155.28 Total Expenses 27,477.79 22,046.74 18,310.75 15,900.09 15,461.15 11,448.60 10,621.38 9,352.78 8,823.23 7,288.84
  • STANDALONE P&L ACCOUNT (Page 2) Mar '13 Mar '12 Mar '11 Mar '10 Mar 09 Mar '08 Mar '07 Mar '06 Mar '05 Mar '04 OPERATING PROFIT 11,126.24 12,012.49 11,170.25 8,905.59 9,176.44 8,244.54 6,913.75 5,884.22 5,956.02 3,474.93 PBDIT 11,353.75 12,935.91 12,606.05 10,146.67 9,779.51 8,830.95 7,275.87 6,136.80 6,064.77 3,482.56 Interest 1,876.77 1,925.42 1,686.27 1,848.19 1,489.50 929.03 251.25 168.44 228.8 230.56 PBDT 9,476.98 11,010.49 10,919.78 8,298.48 8,290.01 7,901.92 7,024.62 5,968.36 5,835.97 3,252.00 Depreciation 1,640.38 1,151.44 1,146.19 1,083.18 973.4 834.61 819.29 775.1 618.78 625.11 Other Written Off 0 0 0 0 0 0 0 0 0 0 Profit Before Tax 7,836.60 9,859.05 9,773.59 7,215.30 7,316.61 7,067.31 6,205.33 5,193.26 5,217.19 2,626.89 Extra-ordinary items 0 0 0 0 0 0 57.29 47.5 80.79 39.77 PBT (Post Extra-ord Items) 7,836.60 9,859.05 9,773.59 7,215.30 7,316.61 7,067.31 6,262.62 5,240.76 5,297.98 2,666.66 Tax 2,773.63 3,162.63 2,912.44 2,168.50 2,114.87 2,380.28 2,040.47 1,734.38 1,823.82 920.44 REPORTED NET PROFIT 5,062.97 6,696.42 6,865.69 5,046.80 5,201.74 4,687.03 4,222.15 3,506.38 3,474.16 1,746.22 Total Value Addition 15,056.16 12,129.37 8,914.83 7,543.64 6,892.44 5,385.07 4,858.96 4,586.34 4,244.80 3,832.56 Preference Dividend 0 0 0 45.88 109.45 22.19 0 0 0 0 Equity Dividend 776.97 1,165.46 1,151.06 709.77 1,168.95 1,168.93 943.91 719.51 719.51 368.98 Corporate Dividend Tax 128.73 181.57 156.71 122.8 214.1 202.43 160.42 100.92 101.86 47.27 PER SHARE DATA (ANNUALISED) Shares in issue (lakhs) 9,712.15 9,712.14 9,592.14 8,872.14 7,305.92 7,305.84 5,804.73 5,534.73 5,534.73 3,677.72 EARNING PER SHARE (Rs.) 52.13 68.95 71.58 56.37 69.7 63.85 72.74 63.35 62.77 47.48 Equity Dividend (%) 80 120 120 80 160 160 155 130 130 100 Book Value (Rs) 568.46 537.64 503.19 418.94 331.68 298.78 240.31 176.26 127.56 122.79
  • CONSOLIDATED P&L ACCOUNT (Page 1) Mar '13 Mar '12 Mar '11 Mar '10 Mar '09 Mar '08 Mar '07 Mar '06 Mar '05 Mar '04 INCOME Sales Turnover 138,821.14 135,975.56 121,345.75 104,229.83 149,984.94 134,089.02 27,437.29 22,272.14 17,414.52 12,372.53 Excise Duty 4,109.60 3,075.86 2,686.43 1,924.00 2,620.11 2,588.74 2,319.51 2,027.71 1,415.91 1,243.09 Net Sales 134,711.54 132,899.70 118,659.32 102,305.83 147,364.83 131,500.28 25,117.78 20,244.43 15,998.61 11,129.44 Other Income -6,910.73 4,934.95 3,687.41 -61.87 -3,358.50 6,926.67 340.87 213.15 123.22 -67.71 Stock Adjustments -1,418.92 785.93 1,355.98 -660.04 -1,975.94 890.53 540.22 47 289.02 123.99 TOTAL INCOME 126,381.89 138,620.58 123,702.71 101,583.92 142,030.39 139,317.48 25,998.87 20,504.58 16,410.85 11,185.72 EXPENDITURE Raw Materials 68,955.31 74,555.02 61,193.71 51,855.32 82,457.46 68,159.81 10,353.64 7,460.93 4,788.73 3,015.18 Power & Fuel Cost 6,544.38 5,935.48 4,889.18 4,885.05 6,985.10 5,638.98 1,600.71 1,133.70 842.66 84.16 Employee Cost 18,918.25 17,228.64 15,286.92 16,462.99 17,975.06 16,673.21 1,884.97 1,672.46 1,414.42 1,401.78 Other Manufacturing Expenses 5,152.01 7,456.60 6,606.07 6,053.34 7,137.97 7,259.74 1,545.55 1,407.44 1,375.30 0 Selling and Admin Expenses 0 0 11,009.76 9,599.68 11,714.25 11,360.66 1,600.53 1,480.69 1,268.65 0 Miscellaneous Expenses 22,718.45 16,950.73 4,978.70 4,687.37 1,727.48 5,585.74 1,303.41 992.05 707.61 3,364.52 Preoperative Exp Capitalised -1,316.99 -857.63 -219.63 -165.47 -783.07 -597.03 -355.2 -194.58 -234.49 -164.64 Total Expenses 120,971.41 121,268.84 103,744.71 93,378.28 127,214.25 114,081.11 17,933.61 13,952.69 10,162.88 7,701.00
  • CONSOLIDATED P&L ACCOUNT (Page 2) Mar '13 Mar '12 Mar '11 Mar '10 Mar '09 Mar '08 Mar '07 Mar '06 Mar '05 Mar '04 OPERATING PROFIT 12,321.21 12,416.79 16,270.59 8,267.51 18,174.64 18,309.70 7,724.39 6,338.74 6,124.75 3,552.43 PBDIT 5,410.48 17,351.74 19,958.00 8,205.64 14,816.14 25,236.37 8,065.26 6,551.89 6,247.97 3,484.72 Interest 3,968.11 4,250.11 3,426.67 3,659.77 3,790.69 4,588.64 635.67 206.41 238.6 129.3 PBDT 1,442.37 13,101.63 16,531.33 4,545.87 11,025.45 20,647.73 7,429.59 6,345.48 6,009.37 3,355.42 Depreciation 5,575.32 4,516.65 4,414.82 4,491.73 4,265.39 4,136.95 1,010.98 860.37 645.46 640.55 Other Written Off 0 0 0 0 0 0 0 0 0 0 Profit Before Tax -4,132.95 8,584.98 12,116.51 54.14 6,760.06 16,510.78 6,418.61 5,485.11 5,363.91 2,714.87 Extra-ordinary items 0 0 18.5 14.72 15.01 -10.4 62.47 56.28 82.04 0 PBT (Post Extra-ord Items) -4,132.95 8,584.98 12,135.01 68.86 6,775.07 16,500.38 6,481.08 5,541.39 5,445.95 2,714.87 Tax 3,229.44 3,636.46 3,247.26 2,153.46 1,895.68 4,051.03 2,148.52 1,794.99 1,871.96 936.25 REPORTED NET PROFIT -7,362.39 4,948.52 8,856.05 -2,120.84 4,849.24 12,321.76 4,165.61 3,721.07 3,571.20 1,778.62 Minority Interest -214.46 -173.14 -60.28 15.24 -40.94 139.94 67.52 18.64 25.96 19.28 Share Of P/L Of Associates -90.31 -268.11 -66.36 -126.86 -60.72 -168.16 -79.18 -32.19 -58.02 -29.44 Net P/L After Minority Interest & Share Of Associates 332.26 5,389.77 6,653.98 -340.22 9,030.42 6,603.54 4,114.80 3,678.21 3,497.53 1,999.19 Total Value Addition 52,016.10 46,713.82 42,551.00 41,522.96 44,756.79 45,921.30 7,579.97 6,491.76 5,374.15 4,685.82 Preference Dividend 0.21 0.21 0 45.88 109.45 22.19 0 0 0 0 Equity Dividend 776.97 1,165.46 1,150.25 709.23 1,167.88 1,167.86 942.87 718.64 717.69 368.05 Corporate Dividend Tax 226.41 185.71 163.22 154.33 217.64 207.75 163.42 103.36 103.73 48.41 PER SHARE DATA (ANNUALISED) Shares in issue (lakhs) 9,712.15 9,712.14 9,585.43 8,865.43 7,299.21 7,299.13 5,798.01 5,528.01 5,520.69 3,680.46 EARNING PER SHARE (Rs) -75.81 50.95 92.39 -24.44 64.94 168.51 71.85 67.31 64.69 48.33 Equity Dividend (%) 0 0 0 0 0 0 0 0 0 0 Book Value (Rs) 351.85 438.79 384.81 259.67 298.25 393.22 249.66 186 132.86 126.52
  • SALES TURNOVER 0 20000 40000 60000 80000 100000 120000 140000 160000 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 STANDALONE CONSOLIDATED Rs. crores
  • OPERATING PROFIT 0 2000 4000 6000 8000 10000 12000 14000 16000 18000 20000 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 STANDALONE CONSOLIDATED Rs. Crores
  • NET PROFIT -10000 -5000 0 5000 10000 15000 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 STANDALONE CONSOLIDATED Rs. Crores
  • SHAREHOLDING PATTERN AND STOCK PRICE
  • PROMOTER’S HOLDING
  • SHARE PRICE DEPENDENCY • FUNDAMENTAL FACTORS • TECHNICAL FACTORS • MARKET SENTIMENTS
  • FUNDAMENTAL FACTORS • EARNING PER SHARE • A VALUATION MULTIPLE (P/E RATIO) • DEMAND AND SUPPLY
  • DEMAND AND SUPPLY • This fundamental rule of economics holds good for the equity market as well. The price is directly affected by the trend of stock market trading. When more people are buying a certain stock, the price of that stock increases and when more people are selling he stock, the price of that particular stock falls. Now it is difficult to predict the trend of the market but your stock broker can give you fair idea of the ongoing trend of the market but be careful before you blindly follow the advice.
  • TECHNICAL FACTORS • INFLATION • ECONOMIC STRENGTH OF MARKET AND PEERS • DEMOGRAPHICS • TRENDS • LIQUIDITY
  • MARKET SENTIMENTS • The price of the stock of a company is affected most of the time by the general market direction during a session. In a bull market, the stock price of most companies will rise and in a bear market the stock price of most companies will fall. One can gauge the market sentiment by looking at stock indexes or its future price movement.
  • MARKET CAPITALISATION • Market Cap - If you are trying to guess the worth of a company from the price of the stock, you are making a huge mistake. It is the market capitalization of the company, rather than the stock, that is more important when it comes to determining the worth of the company. You need to multiply the stock price with the total number of outstanding stocks in the market to get the market cap of a company and that is the worth of the company.
  • NAME LAST PRICE(RS.) MARKET CAP.(CRORES) TATA STEEL LTD. 218.45 21213.38 SAIL 40.1 16562.7 JINDAL STEEL 207 19387 COMPARE MARKET CAP WITH PEERS
  • 0 5000 10000 15000 20000 25000 TATA STEEL LTD. SAIL JINDAL STEEL MARKET CAP.(CRORES) MARKET CAP.(CRORES)
  • TATA STEEL LTD. LISTED • BOMBAY STOCK EXCHANGE • NATIONAL STOCK EXCHANGE INDIA LTD. • LUXEMBOURG STOCK EXCHANGE
  • SHARE PRICE CHART
  • FINAL ANALYSIS WHAT WE THINK LIES AHEAD…..
  • TATA STEEL WRITEOFF (Rs 8700 crores) • $13 Billion dollar deal in 2007 to acquire Corus • The shares were trading around 400 pence but were bought by the Tatas at 608 pence (premium of 34%) • A write-off of $1.6 Billion dollars (Rs. 8700 crores) of the goodwill • This is the reason for net loss in FY ‘13.
  • MAJOR CHALLENGES • Slump in the world steel market. European demand has fallen 30% since 2007 • Has a huge debt which could be about 63,200 crore rupees by the end of FY 14. Cash flows would barely be able to match the interest outflows. • Huge debts have destroyed value for the company and the market capitalization is very low • Tata Steel pays three fourths of its EBITDA as interest CYRUS P. MISTRY Chairman TATA Group & TATA STEEL
  • IMMEDIATE ACTION • Reduce the fixed costs in the European Operations • Sell the non performing assets in Europe • Capacity addition in the Indian operations as the OPM is high • Reduce the debt to at least half in 2-3 years so as to stop the huge interest outflow
  • 105 GLORIOUS YEARS…. AND STILL COUNTING
  • AND TOUCHING THE LIVES OF PEOPLE….