Tata Steel..

redifining the power

of people

Prepared By:
Abhishek Mishra
 An Overview

• It was the vision of the founder,Jamsetji

Nusserwanji Tata., that on 27th February, 1908,
the first stake was driven into the soil of Sakchi.
•
• Backed by 100 glorious years of experience in
steel making, Tata Steel is the world’s 6th
largest steel company
•
• Tata Steel has a balanced global presence in over
50 developed European and fast growing Asian
markets, with manufacturing units in 26
countries.
•
Iron And Steel Produces
IN D IA W O U L D E M E R G E A S A G LO B A L H U B

India to play the Key

role in Steel Market
dynamics
4
Decisions of a Financial
Manager
 Financial Statistics
Entire funds for capital
expenditure were met from
internal generation.

Surplus Cash reserves –

temporarily invested in
money market mutual funds
to facilitate liquidity.
 INVESTMENT ANALYSIS
• Drop in investments by 2003 cr in comparisn to
last year,the reason being use of the liquid
funds for funding the acquisition of Corus.
• Cash flow from investing activities was fruitfully
found to be (29,318)cr as compared to
previous year i.e. (5,429)cr


 New Investments
• NATIONAL INTERNATIONAL
JHARKHAND VIETNAM
CHATTISGARH SOUTH AFRICA
ORISSA AUSTRALIA
TAMIL NADU OMAN
 DIVIDEND DECISIONS
• Dividend Payout Ratio is 29.18% which shows the
percentage of NOPAT paid out as dividend to
the equity shareholders.
•
• If D/P ratio is subtracted from 100 the Retention
ratio is obtained which indicates what amount
of the profits are retained in the business.
•
• In the case of Tata steel the dividend pay out
ratio is 29.18% which means company
retained 70.82% of its net profit.
•
•
•
CORUS DEAL - Financing
D e ta ils o f F in a n cin g o f
C o ru s D e a l
THE NET FUNDING REQUIREMENT OF
CORUS WAS RS . 56 , 150
CRORES ( USD12 . 90 billion )
üTata Steel gave a loan to Tata Steel
Asia Holdings (TSAH) of Rs. 11,750
crores.
ü TSAH raised bridge loans of Rs.
10,900 crores.
üTulip UK Holding raised a mezzanine
loan of Rs. 2,600 crores.
üThus a total of Rs. 25,250 crores
were infused into Tata Steel UK
Limited by way of Equity.
üTata Steel UK Limited raised senior
debts and mezzanine loans of 30,900
crores.The total of Rs. 56,150 crores
was used to pay for the Corus
Acquisition
SWOT ANALYSIS
S W O T A N A LY S IS - T A T A S T E E L
STRENGTHS WEAKNESS
6th Largest Steel Manufacturer in Large debt of 35,000 croresafter CORUS


acquisition
the world 

More than 100 glorious years in

Pressure on margins due to increased capacity


the steel industry 

Combined capacity of 28.2

Investment


million tonnes-3times of current

capacity
Highly equiped machinery

for production
THREATS
Expertized workforce
OPPOURTUNITITES
US steel market is available to Tata Steel for


Bringing operational synergies within selling its product

Leverage return time 

Consolidation in the top 3 position that Consistent growth could take the Tata-Corus

might hurt margins even further combine to 4th place within next 3-4 yaers
Arcelor Mittal’s presence in the markets in

UK poses an imminent threat

 …. I am sure Tata Steel will continue to display the same
vigour and the same sense of spirit as it has in the past ,
to face challenges , excel and lead by example in the years