TATA STEEL LONG PROD 2022-23 Annual Report Analysis

Wed, 14 Jun

TATA STEEL LONG PROD has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

TATA STEEL LONG PROD Income Statement Analysis

• Operating income during the year rose 9.7% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 93.9% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 0.9% in FY23 as against 16.9% in FY22.
• Depreciation charges increased by 8.8% and finance costs increased by 1161.4% YoY, respectively.
• Other income grew by 361.4% YoY.
• Net profit for the year declined by NA YoY.
• Net profit margins during the year declined from 9.3% in FY22 to 14.5% in FY23.

TATA STEEL LONG PROD Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	68,016	74,641	9.7%
Other income	Rs m	1,375	6,345	361.4%
Total Revenues	Rs m	69,391	80,985	16.7%
Gross profit	Rs m	11,504	706	-93.9%
Depreciation	Rs m	3,196	3,477	8.8%
Interest	Rs m	1,100	13,870	1,161.4%
Profit before tax	Rs m	8,584	-10,296	NA
Tax	Rs m	2,285	559	-75.6%
Profit after tax	Rs m	6,299	-10,855	NA
Gross profit margin	%	16.9	0.9
Effective tax rate	%	26.6	-5.4
Net profit margin	%	9.3	-14.5

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TATA STEEL LONG PROD Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 31 billion as compared to Rs 33 billion in FY22, thereby witnessing an decrease of -5.1%.
• Long-term debt stood at Rs 147 billion as compared to Rs 134 billion during FY22, a growth of 9.5%.
• Current assets fell 74% and stood at Rs 38 billion, while fixed assets rose 206% and stood at Rs 174 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 213 billion as against Rs 204 billion during FY22, thereby witnessing a growth of 4%.

TATA STEEL LONG PROD Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	32,005	20,594	-35.7
Current Liabilities	Rs m	33,083	31,386	-5.1
Long-term Debt	Rs m	133,916	146,678	9.5
Total Liabilities	Rs m	204,427	212,967	4.2
Current assets	Rs m	147,412	38,152	-74.1
Fixed Assets	Rs m	57,015	174,243	205.6
Total Assets	Rs m	204,427	212,967	4.2

TATA STEEL LONG PROD Cash Flow Statement Analysis

• TATA STEEL LONG PROD's cash flow from operating activities (CFO) during FY23 stood at Rs -3 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -40 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -2 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -44 billion from the Rs 43 billion net cash flows seen during FY22.

TATA STEEL LONG PROD Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	17,610	-2,700	-
Cash Flow from Investing Activities	Rs m	-94,048	-40,136	-
Cash Flow from Financing Activities	Rs m	119,233	-1,624	-
Net Cash Flow	Rs m	42,795	-44,460	-

Current Valuations for TATA STEEL LONG PROD

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -240.7, an decline from the EPS of Rs 139.7 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 686.4, stands at -1.3 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.5 times, while the price to sales ratio stands at 0.4 times.
• The company's price to cash flow (P/CF) ratio stood at -4.2 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	1,508.1	1,655.0
TTM Earnings per share	Rs	139.7	-240.7
Diluted earnings per share	Rs	139.7	-240.7
Price to Cash Flow	x	3.4	-4.2
TTM P/E ratio	x	5.1	-1.3
Price / Book Value ratio	x	1.3	1.5
Market Cap	Rs m	40,580	31,162
Dividends per share (Unadj.)	Rs	12.5	0.0

Ratio Analysis for TATA STEEL LONG PROD

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.2x during FY23, from 4.5x during FY22. The current ratio measures the company's ability to pay short-term and long-term obligations.

Interest Coverage Ratio: The company's interest coverage ratio deteriorated and stood at 0.3x during FY23, from 8.8x during FY22. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

• Profitability Ratios

Return on Equity (ROE): The ROE for the company declined and down at -52.7% during FY23, from 19.7% during FY23. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

Return on Capital Employed (ROCE): The ROCE for the company declined and down at 2.1% during FY23, from 5.8% during FY22. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

Return on Assets (ROA): The ROA of the company declined and down at 1.4% during FY23, from 3.6% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	4.5	1.2
Debtors’ Days	Days	0	0
Interest coverage	x	8.8	0.3
Debt to equity ratio	x	4.2	7.1
Return on assets	%	3.6	1.4
Return on equity	%	19.7	-52.7
Return on capital employed	%	5.8	2.1

To see how TATA STEEL LONG PROD has performed over the last 5 years, please visit here.

TATA STEEL LONG PROD Share Price Performance

Over the last one year, TATA STEEL LONG PROD share price has moved up from Rs 608.3 to Rs 686.4, registering a gain of Rs 78.1 or around 12.8%.

Meanwhile, the S&P BSE METAL Index is trading at Rs 20,582.0 (up 1.6%). Over the last one year it has moved up from 16,942.0 to 20,582.0, a gain of 3,640 points (up 21.5%).

Overall, the S&P BSE SENSEX is up 19.3% over the year.

(To know more, check out historical annual results for TATA STEEL LONG PROD and quarterly results for TATA STEEL LONG PROD)