Tata Steel Ltd 144A

Ladies and gentlemen, good day and welcome to the Tata Steel analyst call. Please note that this meeting is being recorded. All the attendees' audio and video has been disabled from the backend and will be enabled subsequently. I would now like to hand the conference over to Ms. Samita Shah. Thank you and over to you, ma'am.

Thank you, Kinshuk. Good afternoon, good morning and good evening to all our viewers joining us from different parts of the world. On behalf of Tata Steel, I'm delighted to welcome you to this call to discuss our results for the fourth quarter and the full year financial year of FY25. We declared our results yesterday and there's a detailed presentation along with the SEBI release, detailed presentation on our website which discusses the results. During this call, we will walk you through some of the details and also take on any questions you may have. Before I move on, I just want to remind all of you that the entire discussion today will be covered by the Safe Harbor Clause, which is on page two of the presentation. This call today is led by our CEO and Managing Director, Mr. T.V. Narendran, and our ED and CFO, Mr. Kaushik Chatterjee. Thank you very much again for joining us today. And I will now request Naren to make a few opening comments before we throw the floor open for questions. Thanks and over to you, Naren.

Thanks. Thanks, Amita. And hello, everyone. I'll make a few comments and then pass on to Kaushik. FI25 has been an important year for Tata Steel and it demonstrates ability to navigate challenging operating environment and progress on our stated objectives across geographies. For most of the year, the steel fundamentals diverged across regions with increasing exports from China, which weighed on the price sentiment. And since January, the evolution of the U.S. policy and the nations, different nations focusing on protecting the local industry has led to varied price momentum across India, Europe, and U.K. And at the same time, China continues to struggle with declining steel consumption. Regions like UK, which are yet to review the quotas that they have, have struggled a little bit more because, as you may be aware, in Europe, they have refined the quotas that are available for imports, which has acted to limit the imports. In India also, there's a safeguard duty, which has helped us. Amongst operating geographies, India remains a structurally attractive market and we are committed to leadership in chosen segments. And annual performance has been aided by the commissioning of India's largest blast furnace at Kalinga Nagar, coupled with initiatives to enhance the cost competitiveness and product mix. We achieved the highest ever crude steel production of 21.7 million tons and deliveries of 20.9 million tons for the full year. And across our sites, including in Kalinganagar, which is under ramp-up, we operated close to, excluding Kalinganagar, which is ramping up, we operated close to 100% capacity utilization. And that is an outcome of the way we design our plants, our best-in-class maintenance practices, and our superior marketing and sales network, which helps us maximize our deliveries across cycles in the domestic market. Coming specifically to some of the segments, the deliveries to the auto segment, automotive segment were aided by the focus on new product development, especially the high-strength steels and enhanced capabilities on account of the new continuous annealing line at Kalinga Nagar. We became the first company to localize select automotive product grade CP780 through joint venture J-CAP CPL, and we've come in supplying DP780 grade also to automotive OEMs to support them in their lightweighting initiatives. We also cater to the growing requirements of high-quality wire rods for the auto industry. And these deliveries were also positively impacted by the successful commissioning of the world's longest Elmore conveyor in a wire rod plant in Jhanshikpur. We expect further progress in the product mix with the 0.5 million ton combi mill, which is being set up in Jhanshikpur, which will use the steel that is made out of the erstwhile Ushra Martin plant, which is called Tattersil Kamariya. We expect the furnace has already been commissioned of this point family and over the next few months, the other facilities will also be commissioned. Our branded products and retail vertical achieved volumes of around 7 million tons, aided by the best-ever sales of Tata Tiscon, Tata Astrum, and Tata Stelium. Tata Tiscon volumes grew by about 19% year-on-year. It is the second year in succession that they've had double-digit growth, and it has reached 2.4 million tons, while our hot-roll brand, Tata Astrum, and the cold-roll brand, Tata Stelium, together achieved record sales of 3.8 million tons. Our e-commerce platform, Asiana, served more than 1,000,000 unique customers customers during the year with a gross merchandise value of over 3,500 crores. Moving on to the industrial products and projects engineering, it witnessed a double-digit growth and contributed to the construction of around 2,500 kilometers of oil and gas pipelines. Once the Kalinganagar plant was commissioned, we had said that we will focus on oil and gas because that's also a high-end approval-based business, just like the automotive business. In line with our focus to grow in chosen segments, we have also forayed now into commercial shipbuilding, supplying grades to various shipbuilders in India, including Mazatom Dock Shipbuilders, Garden Beach Shipbuilders, Cochin Shipyard, and Shoft Shipyards. Our capacity enhancements investments are also progressing well across sites. At Kalinga Nagar, the 5 million ton blast furnace continues to ramp up and the civil work is in progress in the electric arc furnace site in Lugyana, which we hope to commission in the next 12 months. Specific to downstream, the continuous galvanizing lines are expected to be commissioned in the coming months while the ramp up is in progress for the 100,000 ton per annum tubular structural mill that we've set up in Jagshipur. In the UK, we have safely decommissioned both the blast furnaces at Port Talbot and smoothly transitioned to serving customers via downstream processing of the purchase substrate. Our delivery stood at 2.5 million tons, and we were lower on year-on-year basis. UK steel prices are still 8% below the levels that we saw last year due to the import pressures and the subdued demand situation in the UK. As such, we focused on transforming operations towards a sustainable model. And the shift in the operating model, coupled with our focus on controllable costs, has led to the improvement in the fixed cost by over 230 million pounds on an annual basis. But unfortunately, this is not visible as yet in the performance due to the market dynamics. With respect to the proposed transition to green steel making, we have also received the planning permission for the electric arc furnace and are gearing up for the civil work and the construction activity to begin by July. In Netherlands, the liquid steel production was at near capacity, full capacity at 6.75 million tons, the highest in many years. And this is when part has led to a 17% year-on-year increase in deliveries to 6.25 million tons for the full year. EBITDA remains positive on a full year basis and deliveries for the quarter at 1.75 million tons were the highest quarterly volumes in the last six years. We recently launched a cost competitiveness program targeting 500 million euros of savings in FY26, And the transformation is a building block to ensure that Tata Steel Netherlands becomes one of the most efficient and sustainable sites in Europe. We are engaged with the government team to support our integrated decarbonization and environment measurement projects. And I'm happy to share that Tata Steel has been recognized by World Steel as a sustainability champion for the eighth year in a row. With that, I hand over to Kaushik for his comments. Thank you.