India : Tata Steel Sales Up 5% on Higher Exports

Indian steel giant TATA Steel in its BSE filings released its provisional figures for Q2 FY20 quarterly figures yesterday which are as follows:

1.Company’s crude steel output remains stable in Q2FY20- The company churned out 4.50 MnT of crude steel in Q2FY20, remained stable over previous quarter.

In India low investment sentiment and demand slowdown amid plunge in vehicle sales combined with a seasonally weaker monsoon adversely affected overall demand for steel.

Thus lower sales in the domestic market and weakening steel prices resulted to stability in company’s production figure in this quarter.

However, company’s crude steel output surged by 13% to 9 MnT in H1FY20 as against 7.95 MnT in H1FY19.

2. Company’s sales move up by 5% in Q2FY20– The company’s sales volumes witnessed growth by 5% in Q2FY20 and stood at 4.14 MnT as compared to 3.96 MnT in Q1FY20 owing to improved sales at TATA Steel Bhushan Steel Limited (TSBSL).

Along with this, company shifted their interest to exports during Aug-Sep19, which in turn led to better sales performance during the quarter.Also sales deliveries in branded, retail and industrail products were maintained.

However, the company’s sales volumes increased by 6% to 8.10 MnT in H1FY20 as compared to 7.66 MnT in H1FY’19.

Outlook for Q3FY20- The Indian government has announced various measures to stimulate economic activities and market sentiments.Along with  this recent rate cuts announced by the Reserve Bank of India will improve liquidity issue.

However, as the monsoon season comes to an end and the festive season starts,an improvement in sentiment is expected to trigger a pick-up in steel demand.

Tata Steel India Production & Sales Figures

Figures for Tata Steel India includes Tata Steel Standalone, Tata Steel BSL (from May 18, 2018) without eliminating inter-company transactions
Quantity in MnT