India’s second-biggest steel maker by capacity reported that consolidated net profit for the April-June quarter more than doubled year-on-year (y-o-y) to ₹2,077.68 crore, aided by better realisations in India and narrowing losses in its UK business. A Bloomberg poll of 21 analysts had estimated a profit of ₹1,849 crore.
In Q1 of FY25, Tata Steel had reported net profit of ₹918.57 crore. The company announced its Q1 results on Wednesday.
“The strong improvement in our 1Q performance on quarter-on-quarter as well as y-o-y basis was driven by an increase in our net steel realisations and the planned cost takeouts,” said T.V. Narendran, chief executive officer and managing director of Tata Steel in a press release.
For the overseas operations, the steelmaker’s Netherlands operations reported an Ebitda of €64 million compared to a €14 million in Q4FY25, while the UK losses narrowed to £41 million from £80 million in Q4FY25. Ebitda refers to earnings before interest, tax, depreciation and amortization.
“Tata Steel has demonstrated robust profitability across geographies despite volatile global macro conditions and heightened uncertainty,” said Narendran.
In terms of top line, Tata Steel reported a 2.9% decline in consolidated revenue to ₹53,178.12 crore for the first quarter of FY26, compared to ₹54,771.39 crore from the same period last year.
During the quarter, production and deliveries were impacted by maintenance shutdowns in Jamshedpur and Neelachal Ispat Nigam Ltd. In the overseas business, UK deliveries were lower on account of subdued demand.
However, Koushik Chatterjee, executive director and chief financial officer at Tata Steel stated in the press release, “Higher steel realisations offset the decline in volumes across geographies.”
Tata Steel spent ₹3,829 crore in capex during the quarter. The 5 mtpa Kalinganagar plant continues to ramp up, and the G blast furnace relining at Jamshedpur is almost complete. The company is also progressing on major projects like the electric arc furnace at Ludhiana.
“The G blast furnace relining in Jamshedpur is at an advanced stage of completion and with Kalinganagar ramping up, India volumes are expected to be sequentially higher in the next quarter,” said Chatterjee.
“The safeguard duty supported the steel prices and they also benefited from the lower raw material prices,” said Aditya Welekar, senior research analyst, metals at Axis Securities. “That’s why the spread has improved in this quarter.”
The spread refers to the difference between the price Tata Steel sells its steel for and the cost to make it, which affects how much profit it earns on each tonne. The government imposed a 12% safeguard duty on steel imports in May in a move to protect the domestic industry.
Welekar pointed out that steel spreads might be under pressure sequentially in the ongoing July-September quarter as prices have fallen in July compared to June. “However, this could be partially offset by higher Indian volumes, which are expected to rise sequentially as the relining at the G blast furnace is likely to be completed soon,” he said.
Meanwhile, the steelmaker has completed the acquisition of NINL, which generated an Ebitda of ₹224 crore in the June quarter and is Tata Steel’s strategic lever to expand in the long products business. In the UK, construction officially began on 14 July for a low-carbon steel plant.
