Tata Steel Ltd.’s quarterly profit jumped 47 per cent as demand for the alloy boomed, and the company announced a stock split amid a sharp run-up in its share price.
Group net profit surged to 97.6 billion rupees ($1.3 billion) in the January to March period, compared with 66.4 billion rupees a year earlier, it said Tuesday. That beat an average analysts’ estimate of about 95 billion rupees.
Sales advanced 39 per cent to 693.2 billion rupees, while costs rose 44 per cent to 576.4 billion rupees from a year earlier. The company also announced that each share with a face value of 10 rupees will be split into 10 to boost liquidity and make the shares more affordable for investors.
The mill’s share price has more than doubled since December 2020 amid explosive demand as countries across the planet unleashed stimulus to prop up their economies. Tata Steel along with its domestic counterparts is also poised to gain from a supply gap created by Russia’s invasion of Ukraine, as consumers from Europe to Africa seek alternative steel supplies.
Single-digit growth in India’s steel demand driven by the government’s focus on infrastructure and high steel prices may help cushion Tata Steel and its peer JSW Steel Ltd. from elevated input expenses, according to Bloomberg Intelligence. Higher raw material costs have eaten into margins of metal producers globally as supply chains get roiled by the war in Ukraine and energy crisis in some countries.
