Export levy impact: Tata Steel deliveries drop 2% YoY despite higher output
Tata Steel, which announced provisional production and delivery numbers for Q1FY23, clocked a growth of six per cent in domestic production at 4.92 million tonnes (mt), but deliveries to destinations within and outside India, at 4.06 mt, were lower by two per cent.
The firm attributed the drop to moderation in exports following the imposition of 15 per cent export duty.
The market had foreseen lower deliveries by steel companies as an outcome of the export levy that came into effect on May 22, impacting 95 per cent of the country’s finished steel export basket.
Tata Steel’s deliveries were down 20.70 per cent on a quarter-on-quarter (QoQ) basis. However, the company said that domestic despatches were up 5 per cent YoY, leveraging a strong marketing network and an agile business model.
Deliveries to the automotive & special products segment were up 22 per cent YoY, on broad-based recovery across all sub-segments, Tata Steel said. Branded products and retail segment deliveries were broadly similar. Despatches to the industrial products & projects segment rose 8 per cent YoY, on the back of an increase in sales of value-added products to key segments such as engineering.
Also, revenues from Tata Steel Aashiyana, an e-commerce platform for individual home builders, grew by 77 per cent YoY to Rs 457 crore during the quarter.
Tata Steel Europe steel production was up 5 per cent QoQ, but was lower on YoY basis. Total deliveries stood at 2.16 mt and were lower on YoY basis in line with production.
Overall, Tata Steel’s delivery volumes across India, Europe and Thailand were at 6.53 mt compared to 6.83 mt a year back. While production was at 7.66 mt compared to 7.65 mt in Q1FY22.