Chairman's Message
Demonstrating strength and resolve
N. Chandrasekaran
Chairman
Dear Shareholders,
It is my privilege to present to you Tata Steel’s Annual Report for FY2022-23.
I hope this letter finds you and your families well and safe.
The macro-economic volatility and geo-political factors have dominated the global business environment during FY2022-23. Looking ahead, global growth is poised to slow down to 2.8% in 2023 (from 3.4% in 2022), led by a pronounced slowdown in developed markets. In contrast, emerging markets, led by India, will provide some cushion.
India’s growth continues to be resilient, underpinned by the Government’s capital outlay and buoyant private consumption. India’s GDP is estimated to have registered a growth of 6.8% in FY2022-23 and is expected to continue to be the fastest growing large economy for the third consecutive year.
` 0,0 crore Consolidated Revenue (FY2022-23)
From a steel industry perspective, the impact of the tepid global economic recovery led to easing of global steel production. However, India was a notable exception, overcoming uncertain demand-supply dynamics, volatile raw material prices and residual effects of the pandemic.
India's steel consumption grew by
over 10% Y-o-Y to 117 million tonnes in
FY2022-23. Given the current stage of
development of the Indian economy
and the focus on infrastructure
development, steel demand growth
in India is expected to keep pace with
the GDP growth over the next decade.
Demand from key steel consuming
sectors such as construction, capital
goods, railways, and automotive is
expected to remain robust.
For the year ended March 31, 2023,
the Consolidated Revenue of the
Company was ₹2,43,353 crore, which
was marginally lower compared to
the previous year’s Consolidated
Revenue of ₹2,43,959 crore. Both the
Consolidated EBITDA and Profit after
Tax of the Company for FY2022-23
were substantially lower compared to
the previous year. In FY2022-23, the
Consolidated EBITDA of the company
was ₹32,698 crore compared ₹63,830
crore in the previous year. Consolidated
Profit after Tax in FY2022-23 was ₹8,075
crore, compared to ₹41,749 crore in the
previous year. The financial performance
in FY2022-23 was impacted by higher
cost structure due to elevated energy
and emission related costs and raw
material price volatility.
Strategic acquisition
of Neelachal Ispat Nigam Limited successfully completed
In FY2022-23, the Company has continued to make progress towards augmenting the capacities across multiple sites in India, aligned with the objective of achieving its 2030 target of an overall 40 MnTPA capacity.
The Company successfully commissioned, at its Kalinganagar plant, the First Circuit of the 6 MnTPA Pellet plant and Pickling Line & Tandem Cold Mill Line of the 2.2 MnTPA Cold Rolling Mill complex. These will drive cost savings and product mix enrichment. The Company remains focussed on further expansion in Kalinganagar.
The Company completed the
strategic acquisition of Neelachal
Ispat Nigam Limited (NINL). Given its
proximity to the Kalinganagar plant
and its synergistic potential, NINL will
significantly enhance the Company’s
long products portfolio and boost
growth in the segment. Even though
NINL had been shut down for almost
three years, the Company has ramped up
production to the rated capacity within
nine months of the acquisition.
The Company has also made
substantial progress in its simplification
journey and is working on the
amalgamation of seven subsidiaries
and one associate company into
and with Tata Steel. Through these
amalgamations, the Company expects
to achieve greater business synergies,
derive significant cost savings, undertake
focused capital allocation, and
consolidate its market presence under a
single unified brand.
With respect to the international
operations, Tata Steel continues to face
challenges in the UK, Netherlands, and
Canada. TSN and TSUK continue with
their ‘sustainable profit program’, which
is focussed on expanding steel deliveries,
improving yield performance, optimizing
the commercial mix, and reducing
operating costs. In terms of sustainability
initiatives, TSN has also progressed
towards accelerating its transition to
sustainable steel production, with a
plan to move from coal to gas and then
hydrogen-based steelmaking. TSUK
continues to face challenges due to
commodity and energy price volatility,
high input costs, and sluggish demand.
3.15 Mn+
Lives reached through the Company's wide-ranging CSR programmesTata Steel is committed to sustainability and the environment. In alignment with Tata group sustainability initiative, “Project Aalingana”, the Company is committed to achieving Net Zero emissions by 2045 and is working on a decarbonisation road map that combines short, medium, and long-term goals.
The Company continues to engage with communities through its wide-ranging CSR programmes, positively reaching over 3.15 million lives. The Company remains steadfast in continuing to foster the economic and social well-being of the communities it serves.
I would like to take this opportunity
to express my deep appreciation for the
contributions of Ms. Mallika Srinivasan,
who retired from the Board of the
Company after serving for a decade.
I would also like to thank
Mr. David
Crane for his contributions during the
brief tenure at the Board from which he
had to resign due to his
US government
appointment. I also extend a warm welcome to Ms. Bharti Gupta Ramola on
the Board of the Company.
I am happy to share that, the Board of Directors has recommended a dividend of ₹3.60 per Ordinary (equity) share.
In closing, I extend my sincere thanks to all the employees for their resolute efforts towards forging a resilient and agile organisation. I also express my sincere gratitude to all stakeholders for their unstinted support over many years and hope for their continued support in our journey to take the Company to greater heights.
Warm regards,
N. Chandrasekaran
Chairman