13 March 2019: Tata Steel’s acquisition of a heavily indebted Bhushan Steel (BSL) mill has changed the fortunes of the beleaguered facility and helped it prepay a Rs 3,000-crore loan.
The credit rating of the unit has been upgraded to AA for the long term and A1+ for the short term by CARE Ratings, which is expected to reduce the finance cost, leading to better capital creditworthiness.
Among other signs of financial improvement, the earnings before interest, tax, depreciation and amortisation (Ebitda) of the company increased from Rs 1,442 crore in the nine months of 2017-18 to Rs 3,013 crore in the same period this year, while the Ebitda margin has gone up by 8 per cent year-to-date of 2018-19 (FY19), compared to a similar period last year.
The turnover of the company has jumped to Rs 15,374 crore in the first nine months of the current financial year, from Rs 12,908 crore in the previous year — an improvement of 19 per cent.
With hot metal production at 3.1 mt in the first nine months of FY19, the company is on its way to cross 4 mt hot metal output for the first time since its inception this year. Similarly, crude steel (3.1 mt) and hot-rolled coil (2.9 mt) have shown 14 per cent and 16 per cent rise in production, respectively, in the same period this financial year.
“We have adopted three-tier integration plans i.e., excellence, elevate, and expand. In Phase 1, we are working towards stabilisation of the plant, debottlenecking of existing facilities, raise it to the best demonstrated performance, and realise synergies. In Phase 2, we plan to achieve benchmark performance in all areas to achieve rated capacity and generate strong cash flows. In Phase 3, we plan to initiate strategic capital investments to ensure sustainable returns for the stakeholders,” said a company official.
Categories: General News