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NEW DELHI: Tata Steel is likely to report a strong set of numbers on Tuesday when the company announces its March quarter earnings, project analysts, thanks to higher volumes.

Analysts tracking the firm expect revenues to increase 33-38 per cent year-on-year (YoY), while net profit is likely to jump 34-45 per cent. Earnings before interest, taxes, depreciation, and amortization (EBITDA), will likely rise 12-13 per cent, they said.

Below is a detailed commentary on analyst expectations:

Centrum Broking

For the standalone business, the brokerage estimates blended realisation to decrease by Rs 2,800/t QoQ to Rs 71,608/t. Coking coal cost is also expected to increase by $50/t QoQ and sales volume to increase by 17 per cent QoQ at 4.96 mt.

We expect EBITDA/t to decrease by 15 per cent QoQ to Rs24,280/t. Despite lower EBITDA/t, we expect EBITDA to be flat QoQ at Rs 12,000 crore owing to higher volumes. The Europe business is likely to record EBITDA/t of $197, supported by higher volumes and steel prices and flat CoP. Overall, we expect Tata Steel’s consolidated EBITDA to be flat QoQ at Rs 16,100 crore.

Axis Securities

Revenues to grow due to higher steel prices and steel deliveries. Tata Steel has released provisional production and deliveries. Group Steel deliveries are higher at 13 per cent QoQ and 4 per cent YoY.

  • EBITDA is expected to marginally increase as the impact of higher raw material costs (coking coal) is offset by higher steel prices
  • Margin pressure due to higher coking coal prices
  • PAT and EPS to broadly follow EBITDA growth

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