In­dia to be Fo­cus Mar­ket for Tata Steel: Chan­dra

Co plans to re­duce debt and build sus­tain­able ops in EU, says chair­man

The Economic Times - - Companies - Our Bureaus

Mum­bai | Kolkata: Tata Steel chair­man N Chan­drasekaran has said In­dia will be a “fo­cus mar­ket” in the near term with do­mes­tic steel de­mand tipped to grow at a sig­nif­i­cantly higher rate of 6-7% over the next two years.

Ad­dress­ing the com­pany’s an­nual gen­eral meet­ing as chair­man for the first time, Chan­drasekaran said while he ex­pects steel de­mand in the Eu­ro­zone to be “mildly pos­i­tive”, the com­pany will fo­cus on re­duc­ing its ₹ 83,014-crore debt bur­den and build­ing sus­tain­able op­er­a­tions there. Some say Chan­drasekaran’s op­ti­mism stems from gov­ern­ment ini­tia­tives such as ‘Make-in-In­dia’, ‘In­vest In­dia’, ‘Start-up In­dia’ and tax re­forms un­der GST.

The Tata Steel chair­man ex­pects steel de­mand to in­crease on the back of in­fra­struc­ture projects such as 100 smart cities, smart armed forces sta- tions, de­vel­op­ments of ports and rail­ways. “We are op­ti­mistic of 2017-18 be­ing a bet­ter year for the In­dian steel in­dus­try. We, at Tata Steel, are set to cap­ture these op­por­tu­ni­ties and In­dia will be our fo­cus,” he said. In step, Tata Steel wants to in­crease vol­ume of do­mes­tic de­liv­er­ies by nearly 14% to 12.5 mil­lion tonnes in FY18 com­pared with 11 mil­lion tonnes in FY17. “We ex­pect to in­crease this fur­ther to around 12.5 mil- lion tonnes this year,” he said, ad­dress­ing share­hold­ers at the com­pany’s 110th AGM. “We will en­deav­our to ramp up our pro­duc­tion ca­pac­ity, par­tic­u­larly at Kali­na­gana­gar, and lever­age our new and dif­fer­en­ti­ated prod­uct range,” he said. Even as the com­pany saw a 9% rise in rev­enues in Europe in GBP terms, with 20% in­crease in av­er­age rev­enue per tonne, Chan­drasekaran said the group con­tin­ued to face cer­tain chal­lenges on the debt front and in op­er­a­tions. “Our con­sol­i­dated debt is at ₹ 83,014 crore and we need to work to to­wards re­duc­ing this to a long-term sus­tain­able level and we also need to fo­cus on build­ing sus­tain­able Euro­pean op­er­a­tions,” he said at the meet­ing.

Chan­drasekaran also de­fended Tata Steel’s ac­qui­si­tion of Corus in 2007, re­fut­ing al­le­ga­tions made dur­ing the change in lead­er­ship at Tata Sons last year that for­mer Tata Sons’ chair­man Ratan Tata had de­cided to buy UK-based Corus for more than $12 bil­lion de­spite reser­va­tions raised by some board mem­bers and se­nior ex­ec­u­tives. He also de­fended the com­pany’s com­mu­ni­ca­tions with Tata Sons, say­ing an au­dit com­mit­tee un­der­took a de­tailed re­view of the same and had con­cluded that they were fully com­pli­ant.

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