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Company Profile

With its headquarters located in Mumbai, India, Tata Steel Limited is a multinational steel production corporation based in India and a key component of the Tata Group. Industrialist Jamsetji Tata founded the first integrated private steel firm in Asia in the year 1907, in Jamshedpur, Jharkhand, under the name Tata Iron and Steel firm Limited (TISCO). Operations spread across South-East Asia (Thailand), Europe (UK & Netherlands), India, and more than other 26 nations with a commercial reach to more than 50 markets worldwide. Approximately 35 million tonnes of crude steel are produced annually (MTPA) worldwide. Based on the amount of crude steel produced, Tata Steel continuously ranks among the world’s leading producers.

Steel Industry in India

•  India’s steel industry is a major core sector that is essential to the nation’s industrial progress and economic development. India contributes significantly to the world’s steel output and is the second-largest producer of crude steel. Important sectors like infrastructure, building, cars, railroads, electricity, defense, and capital goods are supported by this sector. Alongside public sector organizations like SAIL, private businesses like Tata Steel, JSW Steel, and ArecelorMittal Nippon Steel India play a major part in this industry. Primary producers make steel from iron ore, whereas secondary producers use scrap and sponge iron.
•   India has a competitive advantage because of its plentiful supply of raw materials, such as coal and iron ore, and its robust domestic demand, which is fuelled by housing, urbanization, and extensive government infrastructure projects. The industry is also supported by government programs including the National Steel Policy, Make in India, and incentives for the development of specialty steel. Sustainability and green steel are becoming more and more important as the sector deals with issues like price instability, environmental concerns, and the demand for cleaner technology. All things considered, the Indian steel industry is well-positioned for consistent long-term growth and continues to be a vital component of the country’s economy.
•  The use of metals has been one of the main drivers of industrialization. Among metals, steel has historically held the top position. Because steel is both a raw material and an intermediate product, its production and consumption are often regarded as indicators of a nation’s economic progress. Therefore, claiming that the steel industry has always been at the forefront of industrial advancement and that it is the cornerstone of any economy would not be an exaggeration. Major producers, primary producers, and secondary producers are the three groups into which the Indian steel industry is divided.
• In FY25, India produced 151.14 MT of crude steel and 145.30 MT of finished steel approximately, making it the second-largest producer of crude steel worldwide. According to ICRA,

India’s domestic steel demand is predicted to increase by 9–10% during the year 2025. The availability of inexpensive labour and native raw materials like iron ore has fuelled the expansion of the Indian steel industry. As a result, India’s manufacturing output has been significantly boosted by the steel industry. Modern steel mills are a feature of India’s steel industry. It has consistently worked to upgrade older plants to greater energy efficiency standards and modernize them.

Company Perspective and Review

•  Tata Steel’s total assets increased from ₹1.80 lakh Cr to ₹2.54 lakh Cr during FY21–FY25, driven by growth in tangible assets, capital work-in-progress, and non-current investments. Long-term borrowings increased dramatically to finance CAPEX, and there is an increase in reserves as well. ROCE and ROE are moderate. 
•   In terms of profitability, revenues increased from ₹84,888 Cr in FY21 to ₹144,110 Cr in FY24 before declining to ₹134,764 Cr in FY25. Net profit in FY25 was ₹13,970 Cr, indicating operational stability and fewer extraordinary losses than in FY24. All things considered, Tata Steel has strong long-term growth, aggressive expansion, and strong earnings; nonetheless, cautious handling of short-term liquidity and growing debt is necessary. Tata Steel pays dividends regularly, but the amount and decision to pay depends on profitability and board approval, rather than being a fixed guaranteed schedule. The scrip can be a good buy for those looking for exposure in the infrastructure sector.