Tata Steel net profit for the first quarter of FY26 grew 116.5% year-on-year to Rs 2,078 crore, on the back of better steel realisations and reduced cost aided by strategic cost transformation initiatives. It had reported a net profit of Rs 960 crore in the year-ago period.
India’s oldest steelmaker beat Bloomberg’s profit estimate of Rs 1, 751 crore. The company’s revenue came in at Rs 53, 178 crore, surpassing Bloomberg estimate of Rs 51, 392 crore. Revenue was, however, down 2.9% year-on-year.
Tata Steel statement on Q1 performance
“Tata Steel has demonstrated robust profitability across geographies despite volatile global macro conditions and heightened uncertainty. The strong improvement in our Q1 performance on QoQ (quarter-on-quarter) as well as YoY (year-on-year) basis was driven by an increase in our net steel realisations and the planned cost takeouts,” TV Narendran, chief executive officer and managing director at Tata Steel, said in a statement.
“In India, our large distribution network with 25,000+ dealers & distributors and our focus on delivering customer requirements helped us in selling higher value-added products and in creating value from the new facilities we commissioned,” he added.
He said that the company is leveraging the digital marketplace by expanding presence through e-commerce platforms such as Aashiyana and DigECA, resulting in the gross merchandise value (GMV) through these platforms coming in at Rs 5,400 crore on annualised basis, an increase of 52%.
Earnings before interest, taxation, depreciation and amortisation (Ebitda) at Rs 7,428 crore was also higher than the Bloomberg estimate of Rs 6, 862 crore. Ebitda per tonne in the first quarter of FY26 was Rs 10,503 compared with Rs 7,810 in the previous quarter and Rs 9,407 in the year-ago period.
“Higher steel realisations offset the decline in volumes across geographies. Our cost transformation programme, focused on multiple levers including operating KPIs (key performance indicators), supply chain and procurement, has delivered around Rs 2,900 crore during the quarter,” Koushik Chatterjee, chief financial officer, Tata Steel, said.
At the start of the financial year, Tata Steel had outlined a cost takeout plan to result in Rs 11,500 crore reduction in cost across operations in India, the UK, and the Netherlands. The steelmaker clocked 7.12 million tonne in deliveries compared with 7.39 million tonne in the same quarter a year back and 7.45 million tonne in the previous quarter. Steel production for the quarter was 7.33 million tonne, down from 8 million tonne in the first quarter of FY25 and 7.45 in the previous quarter.
Geography wise performance
Tata Steel’s India revenues came in at Rs 31,137 crore, while Ebitda was Rs 7,486 crore, with an Ebitda margin of 24%. Crude steel production was 5.24 million tonne and deliveries for the quarter came in at 4.75 million tonne. India Ebitda per ton improved by Rs 2, 510 per tonne QoQ to Rs 15,760 per tonne.
“Quarterly production and deliveries were affected by maintenance shutdowns in Jamshedpur and Neelachal Ispat Nigam Limited. Production and deliveries are expected to normalise in the coming quarters,” the company said in its earnings statement.
UK revenues were £536 million for the quarter and Ebitda loss stood at £41 million as against a loss of £80 million in Q4FY25. Deliveries stood at 0.60 million tonne and were marginally lower due to subdued demand.
The firm also held the ground-breaking ceremony for the electric arc furnace at the Port Talbot facility during the quarter.
Netherlands revenues were €1,519 million for the quarter and Ebitda was €64 million compared with €14 million in Q4FY25. Liquid steel production was 1.70 million tonne and deliveries were 1.50 million tonne.
Capex for the quarter stood at Rs 3,829 crore, while net debt at the end of the June quarter was Rs 85,835 crore. The company’s cash & cash equivalents stood at Rs 14,118 crore.