Tata Steel one of largest steel producer in India, has announced its FY11 results yesterday. The company’s FY11 consolidated net profit was seen at Rs.8983 crore versus net loss of Rs.2,009 crore in its previous year. Also, its consolidated net sales were up at Rs.1.17 lakh crore versus Rs.1.02 Lakh crore. cash, bank balances were seen at Rs.10893 crore as on 31 March 2011. Companys net debt was at Rs.46,632 crore as on 31 March 2011. Its Q4 consolidated EBITDA margins was at 13.9% versus 19.4%, YoY (this year it was significantly low). Its Q4 consolidated EBITDA was at $1.05 billion versus $1.12 billion, YoY (year on year basis).
The Indian operation’s profit after tax (PAT) of about Rs.6,866 crore (USD 1,540 million) and EBITDA of Rs.12,225 crore (USD 2,742 million) were the highest ever on the back of higher volumes, improved product-mix and higher realizations. Also, the European operations recorded robust improvement, posting an EBITDA of Rs.4,204 crore (USD 943 million), an increase of Rs 5,555 crore (USD 1,246 million) over FY’10. Higher sales and realizations along with cost-cutting measures, was responsible of this robust growth and very good performance. The sale of Teesside Cast Products (a slab manufacturing facility mothballed in February 2010) was completed in March 2011 in a deal valuing the business at Rs.2,091 crore (USD 469 million).
Company’s net debt at the end of 31 March 2011 was seen at Rs.46,632 crore (USD 10.46 billion) which fell from Rs.52,836 crore (USD 11.85 billion) at the end of the previous quarter.
The 2.9 million TPA brownfield expansion in Jamshedpur is progressing on schedule. The company has also begun site work on its Greenfield project in Odisha.
The Board of Directors of the company has recommended a dividend of Rs.12 per equity share for the financial year ended 31 March 2011.
What about the Tata steel Stock: Tata steel Ltd. after declaring better than expected annual result, the company has now come up with better valuation and we are looking this growth to continue. When we talk about the stock we are now bullish on TATASTEEL as long as the stock trades above the Rs.565 levels, also we will be looking for buying opportunity for short term target of 619 and 637. placing the stop loss just below 563 level.