Tata Steel plans Rs 16,000 crore consolidated capex in FY24

Tata Steel’s top management says that the company will spend Rs 16,000 crore on capital expenditures (capex) for its local and international activities in the current financial year.

Tata Steel’s CEO and MD, T V Narendran, and Executive Director and CFO, Koushik Chatterjee, said that the company had set aside Rs 10,000 crore for its own activities and Rs 2,000 crore for its subsidiaries in India.

“The projected capital expenditure (capex) for FY2023-24 is set at Rs 16,000 crore on a consolidated basis which is intended to be financed through internal accruals over the full year,” the executives said in the company’s annual report for 2022-23.

They said that Rs 10,000 crore has been set aside for Tata Steel stand-alone operations and that the Kalinganagar project will use about 70% of this amount.

The company is working on making its plant in Kalinganagar, Odisha, able to make 8 MT instead of 3 MT.

“Our other Indian subsidiaries, currently in an expansion phase with value accretive projects, especially in downstream operations which are important to service customer needs and improve our value-added product mix, will have a capex of about Rs 2,000 crore,” the company officials said.

Tata Steel Nederland will spend Rs 1,100 crore on capital expenditures to reline its blast furnace in Europe. This work is already in progress. Leaders said that most of the rest of the capex will be spent on things like maintenance, environmental projects, and growth projects.

During the 2022–23 financial year, Tata Steel plans to spend Rs 12,000 crore on capital expenditures (capex) for its India and Europe businesses. In July 2022, Narendran told PTI that Rs 8,500 crore was for operations in India and Rs 3,500 crore was for operations in Europe.

Tata Steel has had thorough and active talks with the UK government about the future of its business in the UK.

Due to the UK’s efforts to cut down on carbon emissions and the rising cost of carbon, it has been clear for a long time that Port Talbot needs to switch to greener technologies in order to keep making steel in the long run.

The talks are still going on, and over the next few years, some of Tata Steel UK’s heavy-duty assets will reach the end of their useful lives.

Tata Steel UK’s management will look at all possible futures for the business and talk to the right people before making major decisions.

“Any decision-making will also take into account our market, customers, supply chain impacts and safe operating practices for our employees,” the officials said.