Tata Steel ramps up financials amid Covid; recommends highest ever dividend

Despite the pandemic stricken challenging business scenario across globe, the country’s oldest steel producer, Tata Steel, said on Wednesday that it strengthened its financial position as it reduced net debt by Rs 29,390 crore taking consolidated net debt to Rs 75,389 crore in FY21.

The debt was down by 28 per cent from start of the year, said chairman N Chandrasekaran of Tata Steel. He was addressing shareholders today at the company’s 114th annual general meeting held virtually.

Besides, the board recommended the highest ever dividend in the company’s history of Rs 25 per fully paid up equity share a dividend of Rs 6.25 for each partly paid up equity share.

During the year, Tata Steel board also made the first final call on the outstanding partly paidup equity shares the company received approximately Rs 3,500 crore in the form of first final call money, said Chandrasekaran.

Pertaining to business, in a bid to simplify the same, Tata Steel has rationalized around 100 legal entities in the last 24 months advanced the merger process of Tata Steel BSL with Tata Steel, it said.

“The Company has also been investing in the areas of digital analytics technology to make the business structurally more competitive agile,” said Chandrasekaran.

With regard to Europe business, the process to separate Tata Steel Netherlands Tata Steel UK is currently underway the transformation programme is focused on building a profitable, resilient sustainable business in the future, he said.

Due to the pandemic, the domestic steel industry also suffered production losses due to the national lockdown especially in the first two quarters of the financial year but managed to recover gradually in the next two of FY21 on the back of strong revival in domestic steel demrebound in manufacturing infrastructure development activity in the country. This helped the company highest ever EBITDA of Rs 30,892 crore in FY21, up 71 percent over the same period last year.

The management demonstrated strong focus on generating free cash flows through tight working capital management disciplined capital allocation during the year to record its highest ever free cash flows of Rs 23,748 crore, it said.

Tata Steel holds special place in my heart, says Ratan Tata

“It is a momentous occasion for Tata Steel today, which, despite the challenges of Covid pandemic across the world the drop in demand, has achieved the results they have announced, especially the highest-ever dividend in the Company’s history, which will make all shareholders who stood with the Company, very grateful happy,” said Ratan Tata, Chairman Tata Trusts Chairman Emeritus Tata Sons while addressing the gathering at Tata Steel’s 114th AGM held virtually on Wednesday.

Ratan Tata said, “Tata Steel has a special place in my heart. This is where I began my career in Tatas 57 years ago, where I had the opportunity of working on the shop floor for three years, watching the Company grow, seeing interacting with people like JRD Tata, Russi Mody, Mr. Nanavati. Today, I stbefore you to recognise the achievements of Tata Steel the new team headed by Mr. Chandrasekaran others who are looking into the future to take the leadership of the Tata Group where it hopes to be in the years ahead.”

“I am very very proud of what this Group has been able to do I look forward to hearing of the continued success of the Tata Group in the years ahead. Chandra, you ought to be exceedingly proud of what your team has achieved,” he added.

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