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Three-fold rise in Tata Steel net profit

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ROBUST GROWTH: (from left) B. Muthuraman, Managing Director, Tata Steel, Philippe Varin, CEO, Corus Group, and Koushik Chatterjee, Vice-President, Finance, and Tata Steel Group CFO, at a press conference in Mumbai on Thursday.
ROBUST GROWTH: (from left) B. Muthuraman, Managing Director, Tata Steel, Philippe Varin, CEO, Corus Group, and Koushik Chatterjee, Vice-President, Finance, and Tata Steel Group CFO, at a press conference in Mumbai on Thursday.

Special Correspondent

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MUMBAI: Tata Steel, which became the sixth largest steel producer globally after the acquisition of Anglo-Dutch company Corus last year, has announced a near three-fold rise in its consolidated net profit (including Corus and other Tata Steel group companies) at Rs. 12,321.76 crore for the year ended March 31, 2008, against Rs. 4,165.61 crore reported in the previous year.

The company board has recommended a dividend of 160 per cent for the year. The board has also recommended a dividend of two per cent on cumulative convertible preference shares (CCPS) of Rs. 100 each payable on a pro-rata basis from the date of allotment of CCPS, that is, January 18 to March 31.

The company’s consolidated income jumped to Rs. 1,32,110.09 crore in 2007-08 from Rs. 25,650.45 crore in the previous year. On a standalone basis, the net profit and income for the year was up 11 per cent each at Rs. 4,687.03 crore (Rs. 4,222.15 crore) and at Rs. 20,028.28 crore (Rs. 17,984.76 crore).

Addressing the media here, B. Muthuraman, Managing Director, Tata Steel, said the Tata Steel group vision was to set a global benchmark in value creation and to increase the return on capital invested to 30 per cent by 2012.

The long-term strategy for the company was to build a strong base in India and look for acquisitions in primary steel making countries rich in raw materials. “Our aspiration in due course is to become a 50-million tonne plus steel company.” Mr. Muthuraman said the company would continue to focus on high value-added products. “Our bearings and tubular divisions are working on products for the Tata Nano.”

Philippe Varin, CEO, Corus, said steel was seeing a strong momentum in Europe, the U.S. and Asia in the current year. “As for raw materials, scarcity and tightness remains.

Mr. Muthuraman said India imported around six million tonnes of steel for consumption last year and this year imports could be 8-9 million tonnes, “as there is no significant capacity addition.” Even if the economy grows more sluggish than expected, there will be a demand-supply gap and this would propel prices.


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