Tata Steel Q1 Review - Results In Line With Estimates; Profit Surge To Continue In The Near-Term: Systematix
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Systematix Research Report
Tata Steel Ltd.’s Q1 FY22 consolidated Ebitda of Rs 159 billion (up 1384% YoY and up 14% QoQ) was in-line with our estimates.
Performance of its three key divisions:
standalone operations Ebitda was Rs 103 billion (up 696% YoY and up 12% QoQ),
BSL Ebitda (reported earlier) was Rs 31 billion (versus Rs 2 billion YoY and up 21% QoQ) and
Tata Steel Europe Ltd.'s Ebitda was Rs 15 billion (up 28% QoQ).
Earnings were largely driven by a sharp 42% YoY and 8% QoQ surge in realisations.
As a result, Ebitda margins surged to $523/tonne (highest since Q1 FY12).
We expect Tata Steel's strong earnings momentum to flow through in H1 FY22 aided by a return to profitability at the European operations.
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