Tata Steel's net debt more than tripled in FY19

Release time：Jun 27, 2019 From：admin

Due to the current reduction in investment and cash and bank balances, Tata Steel's annual net independent debt increased more than threefold to 28,471 million rupees from 87.69 million rupees a year ago to March 2019. According to FY19's 112 annual report, the company's cash and cash equivalents decreased by 40.44 million rupees in 2018-2019, compared with a net increase of 36.84 million rupees last year.

As of March 31, 2018, net independent liabilities increased by 0.42 times over equity, while cash and bank balances and other liquidity investments declined sharply.

Higher total debt and current investment, reduced cash and bank balances, mainly the independent business of Tata Steel, pushed net debt to consolidation levels. At the merger level, net debt increased by 25,664 million rupees, or nearly 37%, to 94,879 million rupees, compared with 69,215 million rupees last year. The total debt of more than 100,000 rupees increased by 86.69 million rupees over the previous year.

According to the annual report, the increase in total debt was mainly due to the return on borrowing (deduction of repayments) of Rs. 83.4 million, while the effect of exchange on conversion was Rs. 3.45 million. The increase in borrowing came mainly from the independence of TSBSL (Tata Steel Bhushan) and Tata Steel, partially offsetting the decline in European and Singapore entities of Tata Steel.

The company's net debt and equity rose to 1.42 times the combined level, compared with 1.37 times last year.

As of March 31, 2019, the company said its liquidity situation remained strong, reaching 15284 million rupees. However, compared with Rs. 363.2 million in March 2018, this figure has been reduced by more than half.

During the year, capital expenditure on Tata Steel at the merger level was Rs. 90.91 million, compared with Rs. 74.79 million in India, Europe and Canada as of March 31, 2018. Last year's expenditure also included Southeast Asian operations, and Tata Steel announced its withdrawal in January.

In a note to shareholders, management said that in the first half of FY19, the total debt reached a peak of 1,186,680 million rupees due to the acquisition of Bhushan Steel (BSL Tata Steel), but it had taken measures to de-leverage Tata Steel's balance sheet to 178.64 million rupees, reducing the total debt.

Despite some pressure in the domestic debt market, we managed to raise Rs. 4315 million through 15 years of convertible bonds to extend the maturity of our debt. The company said that we also provided 12 years of takeout financing for 155 million rupees at Tata Steel BSL.