Tata Steel shares up on stakebuy in Singapore arm for ₹7,324 cr

Tata Group-owned steelmaker Tata Steel has acquired more than 557 crore equity shares in its Singapore subsidiary for $875 million (₹7,324.41 crore). T Steel Holdings Pte. Ltd (TSHP) is a wholly owned foreign subsidiary of the company, and it will continue to be a wholly owned subsidiary following this acquisition.

Following the announcement of the acquisition, the shares of Tata Steel surged marginally by 0.33% to ₹163.40 apiece on the BSE today. The scrip opened at ₹163.40 compared to the previous closing price of ₹162.85. The stock has dropped 6.57% over the past month, while it gained 20.73% in the past six months, and increased 16.29% year-to-date (YTD).

"The company has acquired 557,32,48,408 equity shares of face value $0.157 each aggregating to $875 million (₹7,324.41 crore) in TSHP," Tata Steel states.

Back in May, the board of Tata Steel had given the green light for injecting funds into T Steel Holdings Pte Ltd (TSHP) through the subscription of equity shares in multiple phases.

Tata Steel's profit for the quarter ending March plummeted 65% year-on-year (YoY) to ₹555 crore, down from ₹1,566 crore in the same quarter the previous year. For the fiscal year 2023-24, the company reported a net loss of ₹4,910 crore, a drop from the ₹8,075 crore profit recorded in FY23.

Revenue from operations fell by nearly 7% YoY to ₹58,687 crore for the March quarter, compared to ₹62,962 crore in the corresponding period last year.

The company's EBITDA (earnings before interest, taxes, depreciation, and amortisation) stood at ₹6,631 crore for the fourth quarter, with an EBITDA margin of 11%.

The company allocated ₹4,850 crore towards capital expenditure for the quarter and ₹18,207 crore for the entire fiscal year. Tata Steel's net debt is currently ₹77,550 crore.

T.V. Narendran, chief executive officer and managing director of Tata Steel, said FY2024 has been a year of progress for Tata Steel with transition towards stated goals in India and abroad despite the challenging operating environment.