Tata Steel beat market estimates in the second quarter with a 16.2 per cent rise in consolidated net profit to ₹3,699 crore, driven by a robust performance in the domestic market that successfully offset slowing demand and ongoing challenges in its European operations.

Tata Steel beat market estimates in the second quarter with a 16.2 per cent rise in consolidated net profit to ₹3,699 crore, driven by a robust performance in the domestic market that successfully offset slowing demand and ongoing challenges in its European operations.

Tata Steel beat market estimates in the second quarter with a 16.2 per cent rise in consolidated net profit to ₹3,699 crore, driven by a robust performance in the domestic market that successfully offset slowing demand and ongoing challenges in its European operations.

A strong showing in the domestic market helped Tata Steel overcome slowing demand in its European operations and beat market estimates in the second quarter.

India's second largest steelmaker, which announced its results on Saturday, reported a 16.2 per cent year-on-year rise in its consolidated net profit at ₹3,699 crore in the quarter ending September 30. Its consolidate revenue grew 11.5 per cent to ₹65,436 crore over the same period. 

The performance of Tata Steel beat most market estimates. But its consolidated EBITDA margin came slightly below estimates at 16.1 per cent.  EBITDA stands for earnings before interest, tax, depreciation and amortisation. 

“We delivered strong growth in deliveries and earnings this quarter, backed by a resilient supply chain and close customer engagement, despite ongoing geoeconomic uncertainty and higher raw material costs. Our Automotive & Special Products vertical achieved ‘best ever’ 2Q volumes of ~1.1 million tons, driven by 26% growth in hi-end sales," T.V. Narendran, Chief Executive Officer and Managing Director, said in a statement. 

Executive Director and Chief Financial Officer Koushik Chatterjee added that the growth in company's profitability was "primarily driven by strength of the India business, which delivered EBITDA of ₹17,790 per ton and a margin of 25 per cent, despite a seasonally softer quarter."

European operations, however, continued to weigh on the company. Deliveries slowed down in both the UK and Netherlands operations. Though the Netherlands unit reported an EBITDA of ₹790  crore, it was a drop from ₹916 crore a year ago. The UK unit had an EBITDA loss of ₹719 crore, a slight improvement from a loss of ₹765 crore a year ago.

Tata Steel's net debt saw an increase to ₹91,423 crore at the end of the second quarter. The net debt stood at ₹80,144 crore in FY26. Likewise, its net debt to equity ratio, an important indicator of financial leverage, inched up to 2.39 times, from 2.30 times in FY26. 

"We continue to make steady progress on our volume and value growth agenda in India. The 4.8 MTPA expansion at Neelachal Ispat Nigam Limited has entered the execution phase. Construction is progressing on the Hot Rolled Pickling & Galvanising Line and the Tinplate expansion project," Narendran said. The company expects the second half of the year to bring higher volumes and margins.

Though Tata Steel's numbers would cheer the market, its rival JSW Steel had reported a bigger surge in profitability in the quarter. JSW Steel's net profit had jumped 225 per cent to ₹5,279 crore in the second quarter.  

A report in the Mint added that Tata Steel, the Dutch government and the Province of North Holland have extended their joint letter of intent by five months to March 2027 to resolve issues concerning the proposed closure of coke and gas plants, steel slag management, energy affordability and the investment framework.

In the UK, Tata Steel continues in its project to replace the existing blast furnaces with an electric arc furnace (EAF) at Port Talbot. The company is getting a financial aid from the UK government to complete the transition. An EAF is environment-friendly method to make steel.

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