Tata Steel
BSE SENSEX
31,955
S&P CNX
9,900
19 July 2017
Update
| Sector:
Metals
CMP: INR571
TP: INR583(+2%)
Neutral
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Annual report: EBITDA growth was offset by WC in FY17
Ind-AS revaluation depresses return ratios, net-debt- to-EBITDA
Analysis of Tata Steel’s (TATA) FY17 is of particular significance because of Ind-AS
introduction. Comparison of re-stated FY16 Ind-AS financials with previously reported
IGAAP brings out many insights.
Stock Info
Bloomberg
Equity Shares (m)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
M.Cap. (INR b)
M.Cap. (USD b)
Avg Val ( INRm)/Vol m
Free float (%)
TATA IN
971.2
572 / 349
11/5/39
546.6
8.6
3013 / 6.8
68.7
Financials Snapshot (INR b)
Y/E Mar
2017 2018E
Net Sales
1,123 1,214
EBITDA
170
186
PAT
37
48
EPS (INR)
37.9
49.6
Gr. (%)
394.2
30.8
BV/Sh (INR)
330
362
RoE (%)
15.7
14.3
RoCE (%)
9.4
9.9
P/E (x)
15.1
11.5
P/BV (x)
1.7
1.6
Shareholding pattern (%)
As On
Promoter
DII
FII
Others
2019E
1,232
203
64
65.6
32.2
418
16.8
10.5
8.7
1.4
Jun-17 Mar-17 Jun-16
31.9
30.8
13.9
23.4
31.4
30.6
14.1
23.9
31.4
27.2
13.3
28.2
FII Includes depository receipts
Standalone EBITDA for FY16 is boosted by INR3.4b, as long-term power supply
arrangement is now finance lease, which has increased debt by INR16.9b.
EPCG benefits are now deferred income; this has increased gross block (hence
depreciation) and non-cash EBITDA (INR3.4b in FY17).
TSE-LP disposal:
Ind-AS FY16 financials have excluded disposed assets, which
contributed loss of INR1.8b to EBITDA. TATA received
negative consideration
of INR19.6b,
which was over and above INR4b net working capital.
TSE turnaround is largely attributable to reduction in repair & maintenance,
GBP depreciation, and some expansion in spreads in FY17.
Accounting of JVs on equity method has reduced net debt by INR54b and
EBITDA by just INR2b, thereby benefitting EV/EBITDA.
Book value is inflated by INR132/share to INR425/share on fair valuation of
assets and goodwill is trimmed by INR100/share to INR42/share in FY16.
All the
return ratios (RoE, RoCE, RoIC, asset turn) have declined under Ind-AS.
Net-debt-to-equity declined sharply. On the other hand, EBITDA margin has
improved under Ind-AS for TATA. Please refer to Exhibit 9.
Working capital ate away EBITDA growth in FY17:
Despite a strong growth in
EBITDA from INR80b in FY16 to INR170b in FY17, operating cash flows actually
dipped due to major swing in working capital. Disposal of assets was associated
with INR10.8b cash outflow. TATA had to borrow INR27b incrementally, though
net debt increase is lower at INR13b on translation gain.
Expect strong operating performance on strong steel pricing and spreads
Fair valuation of assets under Ind-AS has rendered traditional tools of valuation
(e.g. P/BV) and leverage (e.g. debt/equity) useless. We need to now rely solely
on cash generation potential, even for the cyclical steel industry.
TATA witnessed strong growth in EBITDA, though FCF was still negative in FY17.
We expect stronger operating performance but still do not expect FCF
generation because of pending BRPL acquisition and BPS payouts in FY18.
However, we expect FCF generation and reduction in net debt in FY19.
The global steel market has been stronger than our expectation, as Chinese
steel demand has surprised positively so far in CY17. It is difficult for China to
sustain high demand growth at such a high base, in our view. Therefore, we are
cautious on the steel price outlook.
TATA operates in India and Europe, where the markets are protected against
dumping. More protection is expected in Europe by October. This may drive
upgrades for TSE. Protection does help in the short term, but is never water
tight, in our view. We maintain
Neutral.
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.
Sanjay Jain
(SanjayJain@MotilalOswal.com); +91 22 6129 1523
Dhruv Muchhal
(Dhruv.Muchhal@MotilalOswal.com); +91 22 6129 1549

Tata Steel
Analysis of Tata Steel’s (TATA) FY17 annual report is of particular significance
because of introduction of Ind-AS. While there has been lot of discussion on Ind-AS,
the application for each company is unique due to subjectivity in interpretation.
Comparative numbers for FY16 are also reported, helping to understand the impact.
Standalone EBITDA boosted under Ind-AS
We start with the comparison of income statement under erstwhile Indian GAAP
(IGAAP) and Ind-AS for FY16 (Exhibit 1). The EBITDA for FY16 is boosted by INR4b
under Ind-AS because Tata Power’s plant is virtually a captive power plant (CPP) for
TATA. However, this gets offset by corresponding charge to P&L in finance cost and
INR15.3b increase in long-term debt. Capital gains, and similarly, non-recurring
income is now stripped from other income and reported under other
comprehensive income (OCI). Depreciation has increased on fair valuation of fixed
assets, which adversely impacts EPS and RoE.
Finance lease of power
assets has increased
recurring EBITDA by
INR3.4b and net debt by
INR15b
Exhibit 1: Income Statement (standalone)
Y/E March
Net Sales
Total Expenses
Purchase finish/semi
Raw material
Staff Cost
Power
Freight & Handling
Other Exp
Decrease (Increase)
EBITDA
% of Net Sales
Depn. & Amortization
EBIT
Finance cost
Other income
PBT before EO
EO income
PBT after EO
Current tax
Deferred tax
Tax
Rate (%)
Reported PAT
2016
IGAAP
382,103
309,986
9,920
97,000
43,250
27,430
29,950
101,010
1,426
72,118
18.9
19,331
52,786
14,603
38,907
77,091
-15,826
61,265
12,809
-553
12,256
20.0
49,010
2016
IND-AS
382,687
306,569
9,915
97,000
43,199
24,078
29,949
101,721
708
76,118
19.9
29,623
46,495
18,481
3,912
31,926
-16,493
15,433
11,933
-6,056
5,877
38.1
9,557
Remarks
Change
583
-3,417
-5
0
-51
-3,353
-1
711
-718
4,000
1.0
10,292
-6,291
3,878
-34,995
-45,165
-667
-45,832
-876
-5,503
-6,379
18.1
-39,453
INR million
2017
IND-AS
excluding excise
479,930
361,171
8,812
124,968
Actuarial shifted to OCI
46,051
Fin. lease (Tata Power)
27,698
37,836
129,103
-13,297
boosted (Fin. Lease)
118,760
24.7
Fair value asset revaluation
35,416
83,344
Fin. Lease
26,886
Capital gains shifted to OCI
4,145
60,603
-7,034
53,569
14,005
balance sheet approach
5,118
19,124
35.7
34,445
Source: Company, MOSL
INR3.4b EPCG benefits are
non-cash EBITDA in FY17.
This has boost fixed asset as
well
TATA has imported plant and machinery under EPCG (Export Promotion against
Capital Goods) scheme. Earlier, this was shown as contingent liabilities. Under Ind-
AS, EPCG benefits are now being recognized as INR20b deferred income. Fixed asset
purchase cost has increased correspondingly. The EPCG benefit is recycled to P&L
depending upon exports, which boosts EBITDA without corresponding increase in
cash flows. In 4QFY17, INR3.4b was released to revenue, thereby boosting EBITDA.
19 July 2017
2

Tata Steel
TSE: Turnaround driven by favorable currency movement, lower
maintenance, and higher spreads
There is very little impact on TSE (Europe) financials under Ind-AS because its
accounts were already being prepared under IFRS. However, the difference in
income statement for FY16 is because of the sale of the long products business (TSE-
LP) to Greybulls. TSE-LP contributed INR1.8b EBITDA loss and INR10b EBIT loss in
FY16. These recurring savings (absence of losses) have been achieved at the cost of
INR30.6b write-down, which includes cash outflow of INR11b and net working
capital outflow of INR5b.
Exhibit 2: Income Statement (TSE)
Y/E March
Net Sales
Deliveries (mt)
Total Expenses
Purchase finish/semi
Raw material
Staff Cost
Other Exp
Decrease (Increase)
EBITDA
Depn. & Amortization
EBIT
2016
IGAAP
674,020
13.6
680,970
51,080
214,650
140,030
257,700
17,510
-6,950
26,377
-33,327
2016
IND-AS
535,550
11.0
540,680
56,820
170,130
118,150
182,180
13,400
-5,130
18,330
-23,460
Remarks
Difference
138,470
2.6
140,290
-5,740
44,520
21,880
75,520
4,110
-1,820
8,047
-9,867
INR million
2017
IND-AS
520,850
9.9
473,800
55,180
168,830
113,440
163,620
-27,270
47,050
16,390
30,660
Sale of TSE LP
Source: Company, MOSL
Exhibit 3: Disposal of TSE – long products
Disposal of TSE-LP came at
a cost of INR11b cash
outflow and INR5b net
working capital
(a) Net Asset disposed
Net working capital
(b) Net Consideration
sale consideration
exchange diff.
transaction cost
Pension curtailments
Profit and loss (b-a)
INR million
10,973
4,856
-19,653
-11,692
420
489
-8,870
-30,626
Source: Company, MOSL
The turnaround was driven
largely by sudden currency
depreciation and reduced
maintenance
TSE turned around in FY17. Analyzing the P&L on per ton of shipments reveals that
the turnaround in margins was driven by reduction in operating cost from
USD437/tonne in FY16 (ex-TSE LP) to USD375/tonne in FY17. This was primarily
driven by depreciation of GBP post referendum on Brexit. Most of this benefit was
reflected in 4QFY17, which is surprising, because currency benefits were available in
the first three quarters as well. Spreads increased by USD16/tonne, while operating
cost declined by USD62/tonne (-14%, largely driven by GBP depreciation against
USD), swinging EBITDA/tonne from loss of USD7 to profit of USD71.
19 July 2017
3

Tata Steel
Exhibit 4: TSE P&L (USD/t)
700
525
350
175
0
-175
0
1
16
299
240 259
75
80
66
384 396
95 102
-19
447 409 433 478 424 442
399
437
375
71
Oprerating costs
Spread (Realization-RM)
EBITDA
53
16
11
36
51
-8
-7
Source: Company, MOSL
An analysis of other expenses at all subsidiaries indicates that the repair and
maintenance cost was significantly lower in FY17. Though GBP depreciation may
have contributed to half of this decline, the remaining decline can be attributed to
reduced maintenance, which may not be sustainable. Some of these gains were
offset by unfavorable exchange at TSGH, Singapore.
Exhibit 5: Other expenses
Y/E March
(a) stores and spares
(b) Repairs to buildings
(c) Repairs to machinery
(d) Relining expenses
(e) Fuel oil consumed
(h) Freight and handling
(i) Rent
(k) Rates and taxes
(m) Comm./disc./rebates
(n) provisions
(o) Excise duty
(p) Others
Total Other Expenses
Consolidated (a)
2016
2017
82,879
78,811
1,137
1,010
55,343
53,330
1,180
1,410
4,863
4,671
68,321
72,681
27,296
23,641
11,573
16,443
2,584
2,350
1,011
460
43,752
51,205
34,802
53,072
412,555 446,197
Standalone (b)
2016
2017
24,458
27,518
574
708
20,253
22,818
431
554
1,381
1,112
29,949
37,836
735
756
7,528
12,984
1,828
2,071
225
161
44,288
52,679
18,298
23,334
206,024 249,491
All subsidiaries (a-b)
2016
2017
YoY
58,421
51,293
-7,129
563
302
-261
35,090
30,512
-4,579
749
856
107
3,482
3,560
78
38,372
34,845
-3,527
26,560
22,885
-3,675
4,045
3,459
-586
756
279
-478
786
299
-487
-536
-1,474
-938
16,504
29,738
13,234
206,531 196,706 -9,825
Remarks
Reduced Maint. & currency
Reduced Maint. & currency
INR million
lower volumes
Currency
Unfavorable currency (TSGH)
Source: MOSL, Company
19 July 2017
4

Tata Steel
JV accounting reduced net debt by INR54b at the cost of only INR2b EBITDA
Accounts of three subsidiaries (Jamshedpur Continuous Annealing & Processing, TM
International, and TM Mining) are now being integrated on equity method. As
explained in the following tables, net debt has reduced by INR54b in FY16.
Net debt declined by
INR54b on JV accounting
and increased by INR16.9b
in FY16 under Ind-AS
Exhibit 6: Net debt calculations
2015
IGAAP
22,750
200
805,937
656,752
149,185
828,887
13,746
87,499
2015
IND-AS
22,750
Change
2016
IGAAP
22,750
2016
IND-AS
22,750
INR million
Change
2017
IND-AS
22,750
Hybrid Perpetual Securities
Pref. Shares
Borrowings (LT+ST)
LT
ST (incl. current LT)
Gross Debt
Less: current investment
Less: cash
Less: cash
Net Debt
Impact due to Ind-AS
Finance lease
JV ( equity method)
765,982
622,516
143,466
788,732
12,146
81,771
713
727,641 694,101
8,918
26,337
817,604
648,728
168,876
840,354
46,636
61,091
773
-33,540 769,129 731,855
17,419
-50,959
10,499
27,402
860,696
683,541
177,155
-40,155 883,446
47,161
67,156
827,959
640,223
187,736
-43,092 850,709
56,731
48,323
888
-37,274 744,767
16,903 30,455
-54,177
Source: Company, MOSL
Under Ind-AS, EBITDA from subsidiaries (calculated as reduction of TSI and TSE
financials from consolidated P&L) indicates a loss of INR2b only in EBITDA on
account of shift to Ind-AS against reduction in debt by INR54b in FY16. This makes
the overall valuations look better under Ind-AS.
EBITDA declined by INR2b
only under Ind-AS
Exhibit 7: P&L (Consolidated – standalone –TSE)
Y/E March
Net Sales
Total Expenses
Purchase finish/semi
Raw material
Staff Cost
Other Exp
Decrease (Increase)
EBITDA
2016
IGAAP
115,393
104,704
40,740
10,233
16,388
-45,670
5,602
10,689
2016
IND-AS
101,411
92,715
39,078
14,019
14,527
-39,425
5,144
8,695
Change
-13,982
-11,988
-1,662
3,786
-1,861
6,245
-458
-1,994
Remarks
JV equity A/c
INR million
2017
IND-AS
122,214
117,945
50,258
30,383
13,031
-25,596
-4,815
4,269
JV equity A/c
Source: Company, MOSL
Net worth boosted on fair valuation of assets
Net worth of TATA (consolidated) has been inflated by INR128b (INR132/share) to
INR413b (INR425/share and INR385/share if adjusted for goodwill) in FY16. Large
part of this upgrade is driven by fair valuations of Indian assets and investment in
group companies. Goodwill has been shaved off by INR97b to INR41b in FY16.
19 July 2017
5

Tata Steel
Net worth got boosted by
INR132/share under Ind-AS
Exhibit 8: Net worth revalued under Ind-AS
FY15
FY16
Consolidated
313,494 284,789
140,410
104,581
9,432
-1,649
210,121
39,048
9,464
-1,537
INR million
FY15
FY16
Standalone
666,639 704,767
242,606
107,911
9,352
-2,376
-2,315
-478,753
232,932
39,296
9,352
-2,231
-2,315
-478,753
Equity as per Previous GAAP
Re-measurements on transition to Ind AS
Property, plant and equipment
Financial instruments
Reversal of proposed dividend and tax thereon
Leases
Government grants
Fair valuation of investments in subsidiaries
Employee benefits
Change in method/scope of consolidation
Business combinations
Others
Tax impact on above adjustments
Equity as per Ind AS
Net impact
14,149
6,105
-72,291
-3,468
-64,000
446,762
133,268
5,318
9,027
-76,770
-3,804
-62,630
413,026
128,237
-187
-40,984
501,893
-164,746
329
-37,003
466,374
-238,393
Source: Company, MOSL
Balance sheet ratios now have very different meaning
Under Ind-AS, net worth has been re-measured based on fair valuation of assets,
which has completely changed the meaning of return ratios (RoE, RoIC and RoCE)
and financial ratios (net debt/equity, book value, etc).
EBITDA declined by INR2b
only under Ind-AS
Exhibit 9: Basic financial ratios
Y/E March
Basic (INR)
EPS
BV/Share (ex-goodwill)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Ratios (%)
EBITDA Margins (%)
Net Profit Margins (%)
RoE
RoCE (pre-tax)
RoIC (pre-tax)
Fixed Asset Turnover (x)
Net Debt/Equity
2016
Remarks
IGAAP
Ind-AS
8
152
71.6
28.1
3.6
1.1
17.2
6.5
0.6
4.6
5.4
3.3
2.5
5.2
-22 Other income reclassified in OCI
385 Fair valuation of assets boosted book value
-25.4
10.9
1.4 book value got boosted
1.2
15.9 Net debt/EBITDA of JVs (went off B/S) was very high
7.8 lower margin JVs went off B/S
-2.1
-5.4
2.2 Capital employed increased on fair valuation
3.2
1.5
2.0 boost to net worth and reduction in debt
Source: Company, MOSL
INR million
Cash flow analysis: EBITDA growth was offset by WC swing in FY17
Despite a strong growth in EBITDA from INR80b in FY16 to INR170b in FY17,
operating cash flows actually dipped due to major swing in working capital.
Contrary to general expectation, standalone business witnessed a release of
working capital despite start of new 3mtpa steel plant at Kalinganagar (KPO),
Odisha. Though inventories and trade receivables increased, the increase in
payables is disproportionately higher, which explains release of working capital.
The total EBITDA from subsidiaries saw a multifold improvement, but the
operating cash flows turned negative due to massive increase in working capital.
19 July 2017
6

Tata Steel
Disposal of assets was associated with INR10.8b cash outflow.
Net borrowings were INR27b, though net debt increased only by INR13b. There
may have been benefits from translation gains on the reporting date.
INR million
Standalone (b)
2016
2017
76,118 118,760
101
-3,153
9,940
11,115
-12,441 -15,409
73,718 111,313
-47,779 -31,729
34,179
-2,672
0
0
1,500
1,939
5,004
-12,101 -27,457
0
0
15,234 -34,647
-9,263
-9,247
-31,376 -28,903
-25,404 -72,797
36,213
11,058
15,530
51,743
51,743
62,801
Subsidiaries (a-b)
2016
2017
3,565
51,319
-11,544
8,889
51,716 -60,022
-2,902
-3,018
40,836
-2,832
-53,855 -45,428
5,342
6,224
-775 -10,814
1,282
-1,185
6,712
-6,454
-41,294 -57,656
0
6,519
4,436
61,688
-200
-251
-26,123 -21,083
-21,887
46,873
-22,345 -13,616
79,101
56,756
56,756
43,141
Source: Company, MOSL
Exhibit 10: Cash flow statement
Y/E March
EBITDA
Reconciliation income (loss)
(Inc)/Dec in Wkg. Cap.
Tax Paid
CF from Op. Activity
(Inc)/Dec in FA + CWIP
(Pur)/Sale of Non-cur. Invest.
Acquisition in subsidiaries
Int. & Dividend Income
others
CF from Inv. Activity
Equity raised/(repaid)
Debt raised/(repaid)
Dividend (incl. tax)
Interest & equiv. paid
CF from Fin. Activity
(Inc)/Dec in Cash
Add: opening Balance
Closing Balance
Consolidated (a)
2016
2017
79,683 170,078
-11,443
5,736
61,656 -48,907
-15,343 -18,427
114,554 108,481
-101,634 -77,156
39,521
3,552
-775 -10,814
2,782
754
6,712
-1,450
-53,394 -85,113
0
6,519
19,670 27,041
-9,463
-9,498
-57,498 -49,986
-47,291 -25,924
13,868
-2,557
94,631 108,499
108,499 105,942
Exhibit 11: Sum of the parts calculations
2015
India
EBITDA per ton (USD)
EBITDA per ton (INR)
Sales (m tons)
EBITDA-India
Target EBITDA multiple
EV (India) - (a)
INR/share
TSE and other subs.
EBITDA per ton (USD)
Depreciation per ton (USD)
EBIT per ton (USD)
Sales (m tons)
EBITDA
Target EBITDA multiple
EV (TSE) - (b)
INR/share
33% equity in TSE UK ( c )
Target EV (c=a+b-c)
Net Debt (d)
INR/share
CWIP (e)
Sustenance CWIP (s)
Investments (f)
INR/share
(f1) Discount (%)
TP (c-d+e-s+f*(1-f1%))
Target Price (INR /share)
187
11,444
8.7
100,661
6.5
654,295
674
26
37
-11
17.6
-11,791
5.0
-58,953
-61
595,342
727,641
749
286,781
2016
115
7,557
9.5
73,271
6.5
476,258
490
3
29
-26
16.4
3,739
5.0
18,695
19
494,953
769,329
792
354,879
2017
161
10,818
11.0
118,760
6.5
771,937
795
56
24
32
13.0
49,005
5.0
245,024
252
1,016,960
744,767
767
157,841
2018E
169
11,091
12.3
136,080
6.5
884,523
911
58
24
34
13.0
49,626
5.0
248,132
255
18,920
1,113,735
752,579
775
123,121
55,000
3,193
3
20
431,832
445
2019E
171
11,484
12.8
146,810
6.5
954,267
982
64
25
39
13.1
54,675
5.0
273,375
281
21,591
1,206,050
722,016
743
134,501
55,000
3,193
3
20
566,090
583
2020E
161
10,818
12.9
139,685
6.5
907,955
935
64
24
39
13.1
54,948
5.0
274,742
283
21,591
1,161,105
712,526
733
199,501
55,000
3,193
3
20
595,635
613
Source: MOSL, Company
19 July 2017
7

Tata Steel
Financials and Valuations
Income Statement (Consolidated)
Y/E March
Net Sales
Change (%)
Deliveries (mt)
EBITDA
% of Net Sales
Depn. & Amortization
EBIT
Finace cost
Other income
PBT before EO
EO income
PBT after EO
Tax
Rate (%)
Reported PAT
Minority interest P/L
Share of asso. PAT
PAT (After MI & asso.)
Div. on Pref. /Hybrid Sec.
Adjusted PAT
Change (%)
2013
1,347,115
1.4
123,212
9.1
55,753
67,459
39,681
4,792
32,569
-73,899
-41,330
32,294
-78.1
-73,624
-2,145
903
-70,576
1,798
1,524
-91.6
2014
1,486,136
10.3
164,110
11.0
58,412
105,698
43,368
5,168
67,498
-276
67,221
30,582
45.5
36,640
-80
-718
36,001
1,798
34,479
2,162.2
2015
1,395,037
-6.1
127,758
9.2
59,436
68,322
48,478
7,962
27,806
-43,980
-16,175
23,380
-144.5
-39,555
-450
-301
-39,406
1,798
2,776
-91.9
2016
1,171,516
-16.0
75,857
6.5
50,818
25,038
41,286
39,257
23,008
-39,749
-16,740
15,050
-89.9
-31,790
-1,089
207
-30,493
1,798
7,457
168.6
2017
1,122,994
10.1
170,078
15.1
56,729
113,349
50,722
5,275
67,902
-81,884
-13,982
27,780
-198.7
-41,762
687
77
-42,373
2,661
36,851
-275.3
2018E
1,213,503
8.1
185,707
15.3
58,722
126,985
52,291
5,186
79,880
79,880
28,972
36.3
50,908
23
-10
50,874
2,658
48,217
30.8
(INR Million)
2019E
1,231,727
1.5
202,652
16.5
60,784
141,868
52,733
5,028
94,163
94,163
27,689
29.4
66,474
61
-11
66,402
2,658
63,745
32.2
2020E
1,240,715
0.7
194,164
15.6
60,700
133,464
52,586
4,592
85,471
85,471
24,922
29.2
60,549
53
-11
60,485
2,658
57,828
-9.3
Balance Sheet (Consolidated)
Y/E March
Share Capital
Reserves
Net Worth
Minority Interest
Total Loans
Deferred Tax Liability
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Investments
Goodwill on consolidation
Curr. Assets
Inventory
Account Receivables
Cash & liquid investment
Others
Curr. Liability & Prov.
Account Payables
Provisions & Others
Net Current Assets
Appl. of Funds
2013
9,714
332,008
341,722
16,694
702,707
31,185
1,092,308
1,352,650
798,379
554,271
137,862
24,974
130,650
620,943
240,912
139,940
106,200
133,892
(INR Million)
2014
9,714
395,606
405,320
17,377
837,805
25,550
1,286,052
1,570,087
969,844
600,242
259,564
24,251
157,488
674,492
268,800
160,058
112,729
132,906
2015
9,714
303,780
313,494
17,039
828,887
28,618
1,188,037
1,512,105
965,176
546,928
286,781
20,804
134,075
600,639
251,499
133,099
101,246
114,796
2016
9,702
275,086
284,789
16,542
883,646
28,830
1,213,807
1,590,548
1,121,252
469,296
354,879
20,845
137,194
650,068
203,560
117,012
114,317
215,180
2017
9,702
345,741
355,443
16,017
850,709
91,091
1,313,260
1,265,617
380,498
885,118
157,841
67,840
34,947
578,376
248,038
115,868
105,942
108,528
2018E
9,702
376,877
386,579
16,040
863,788
100,755
1,367,162
1,386,376
439,221
947,155
123,121
67,840
34,947
612,047
265,973
126,337
111,209
108,528
417,949
192,831
225,118
194,098
1,367,162
2019E
9,702
431,330
441,033
16,101
867,669
106,277
1,431,079
1,462,257
500,005
962,252
134,501
67,840
34,947
652,383
269,968
128,235
145,653
108,528
420,845
195,727
225,118
231,539
1,431,079
2020E
9,702
479,866
489,569
16,153
867,669
111,334
1,484,725
1,500,637
560,705
939,932
199,501
67,840
34,947
664,778
271,937
129,170
155,142
108,528
422,273
197,155
225,118
242,505
1,484,725
376,391
197,774
178,617
244,552
1,092,308
429,985
229,129
200,856
244,508
1,286,052
401,191
191,899
209,292
199,448
1,188,037
418,475
203,883
214,592
231,594
1,213,807
410,863
185,745
225,118
167,513
1,313,260
19 July 2017
8

Tata Steel
Financials and Valuations
Ratios (Consolidated)
Y/E March
Basic (INR)
EPS
Cash EPS
BV/Share (ex goodwill)
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
Return Ratios (%)
EBITDA Margins (%)
Net Profit Margins (%)
RoE
RoCE (pre-tax)
RoIC (pre-tax)
Growth (%)
Sales
EBITDA
PAT
Leverage Ratio (x)
Current Ratio
Interest Cover Ratio
Net Debt/Equity
E: MOSt Estimates
2013
1.6
-18.4
217.3
8.0
886.5
363.9
-31.0
2.6
0.9
9.3
1.4
9.1
0.1
0.7
6.7
8.5
1.4
-0.8
-91.6
1.6
1.7
2.8
2014
35.5
97.8
255.1
8.0
39.2
16.1
5.8
2.2
0.9
7.8
1.4
11.0
2.3
15.0
9.3
12.3
10.3
33.2
2162.2
1.6
2.4
2.9
2015
2.9
20.5
184.7
8.0
407.4
199.8
27.9
3.1
0.9
10.0
1.4
9.2
0.2
1.3
6.1
8.2
-6.1
-22.2
-91.9
1.5
1.4
4.1
2016
7.7
19.6
151.9
8.0
124.2
74.4
29.1
3.8
1.1
17.5
1.4
6.5
0.6
4.6
5.4
3.3
-16.0
-40.6
168.6
1.6
0.6
5.2
2017
37.9
15.4
329.9
8.0
25.1
15.1
37.1
1.7
1.2
7.6
1.4
15.1
3.3
15.7
9.4
13.3
10.1
113.4
394.2
1.4
2.2
2.3
2018E
49.6
112.9
362.0
8.0
19.2
11.5
5.1
1.6
1.1
7.0
1.4
15.3
4.0
14.3
9.9
12.4
8.1
9.2
30.8
1.5
2.4
2.1
2019E
65.6
131.0
418.0
8.0
14.5
8.7
4.4
1.4
1.0
6.3
1.4
16.5
5.2
16.8
10.5
13.2
1.5
9.1
32.2
1.6
2.7
1.8
2020E
59.5
124.8
468.0
8.0
16.0
9.6
4.6
1.2
1.0
6.5
1.4
15.6
4.7
13.4
9.5
12.4
0.7
-4.2
-9.3
1.6
2.5
1.6
Cash Flow Statement (Consolidated)
Y/E March
EBITDA
Reconciliation income (loss)
(Inc)/Dec in Wkg. Cap.
Tax Paid
Other operating activities
CF from Op. Activity
(Inc)/Dec in FA + CWIP
Free Cash Flow
(Pur)/Sale of Non-cur. Invest.
Acquisition in subsidiaries
Int. & Divident Income
others
CF from Inv. Activity
Equity raised/(repaid)
Debt raised/(repaid)
Dividend (incl. tax)
Interest & equiv. paid
CF from Fin. Activity
(Inc)/Dec in Cash
Add: opening Balance
Closing Balance
2013
123,212
4,424
31,293
-25,690
133,239
-154,715
-21,476
20,569
-1,557
3,576
3,563
-128,564
2,646
25,153
-13,590
-34,657
-20,448
-15,772
121,972
106,200
2014
164,110
10,172
-12,696
-30,127
131,459
-164,201
-32,742
14,356
-1
3,519
11,251
-135,075
156
58,658
-9,244
-39,424
10,146
6,529
106,200
112,729
2015
127,758
11,797
3,514
-24,270
118,798
-134,924
-16,126
28,339
-1,081
3,379
178
-104,109
167
42,119
-11,520
-56,938
-26,172
-11,483
112,729
101,246
2016
75,857
5,894
54,332
-16,450
119,632
-114,859
4,773
39,798
-767
2,437
6,113
-67,277
550
15,329
-9,494
-45,669
-39,284
13,071
101,246
114,317
2017
170,078
5,736
-48,907
-18,427
108,481
-77,156
31,324
3,552
-10,814
754
-1,450
-85,113
6,519
27,041
-9,498
-49,986
-25,924
-2,557
108,499
105,942
2018E
185,707
-21,318
-19,309
145,080
-72,960
72,120
(INR Million)
2019E
202,652
-2,996
-22,167
177,490
-83,380
94,110
2020E
194,164
-1,477
-19,864
172,823
-103,380
69,443
5,186
-7,789
-75,562
5,028
-78,352
4,592
-98,788
-9,302
-54,948
-64,251
5,267
105,942
111,209
-9,302
-55,391
-64,693
34,444
111,209
145,653
-9,302
-55,243
-64,545
9,489
145,653
155,142
19 July 2017
9

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TATA STEEL
Analyst ownership of the stock
No
Served as an officer, director or employee -
No
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Tata Steel
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10