Tata Steel CEO TV Narendran said that Chinese steel prices continue to recover but heavy exports from China are putting pressure on global prices. Noting that steel exports to China exceeded 10 million tons in September, Narendran said the Chinese government's stimulus efforts are aimed at stabilizing global prices.
Tata Steel's net profit for the July-September 2024 period (Q2FY25) was reported at ₹758 crore (USD9.13 million), while the company's profit for this period was estimated at ₹210 crore (USD2.53 million). Narendran said that quarterly prices for its Indian operations would be ₹2000 per ton lower than last quarter. However, the lower coking coal costs had benefited by around USD 20 per ton, he said.
Increased production volumes and cost reductions are expected to have a positive impact on operations in India. However, Narendran warned that EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) margins in India could be lower. The company's production capacity in India has been increased by 1.1 million tons, with a total of 1.4 million tons of additional volume expected.
In the European market, Tata Steel's operations in the Netherlands are expected to produce 2 million tons more this year. However, no improvement is expected in the short term due to challenges in Germany and market conditions across Europe. In the UK, an improvement in EBITDA per ton is expected due to lower fixed costs and blast furnace plant closures.
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