Results Presentation Financial Quarter ended 30 th June 2016 - PowerPoint PPT Presentation

Results Presentation Financial Quarter ended 30 th June 2016 September 12, 2016 1

Safe harbor statement Statements in this presentation describing the Company’s performance may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results may differ materially from those directly or indirectly expressed, inferred or implied. Important factors that could make a difference to the Company’s operations include, among others, economic conditions affecting demand/supply and price conditions in the domestic and overseas markets in which the Company operates, changes in or due to the environment, Government regulations, laws, statutes, judicial pronouncements and/or other incidental factors. 2

Tata Steel Group is committed towards excellence in Health and Safety Ambition: LTIFR* data for Tata steel group Committed to ensuring all Tata steel sites are sustainably fatality  1 0.95 free 0.9 Being the Benchmark in H&S in our industry  0.78 Achievements: 0.8 Significant progress in fatality free ambition but ensuring alertness  0.68 44% 0.7 and drive remains Reduction 0.60 Deploying management system to embed and sustain our  0.6 0.56 0.53 improvement activities. 0.5 Over-all group LTIFR stood at 0.53 for the quarter 0.44  0.39 Key Focus areas: 0.4 Competence development programmes in H&S leadership  0.3 completed for 300 senior leaders 0.2 Prioritised strategic activity in contractor management,  construction and onsite traffic 0.1 Kalinganagar Plant start-up undertaken with systemic risk controls  as used previously at Jamshedpur 0 FY10 FY11 FY12 FY13 FY14 FY15 FY16 Q1 FY17 Health – unique capability and provision with new challenges and  opportunities in all regions 3 *LTIFR is Lost time injury frequency rate

Focused on engaging with communities and improving quality of life India CSR Spend -India ( ` Crs) Nearly 49,000 students of government schools in Primary health care services delivery to nearly East Singhbhum and Seraikela-Kharsawan 1,09,000 people in areas of operation through static 212 districts covered under the mid-day meal and mobile clinics 204 programme A massive fogging activity carried out in Joda as a Drinking water project which will benefit 8,000 171 preventive measure to check Dengue. More than people in eight villages of Ramgarh DT. Daily 55,000 people benefit from the activity 1000KT is supplied and 14Km of pipe lines setup Dedicated super specialty eye hospital  100-bedded super specialty Sankara Eye Hospital inaugurated on June 11, 2016 To provide modern eye-care services to the people of Ganjam and nearby districts of Odisha   Funded entire construction & equipment cost of ` 42 crore Europe 63 The 35th Tata Steel Marquetteloop annual Tata Steel enabled 1,600 children in Port running event near IJmuiden attracted 1,000 Talbot to attend a special event to teach them children this summer about safety A model car test track at Tata Steel’s Academy in IJmuiden inspires young engineers and teaches FY14 FY15 FY16 Q1 the importance of light-weighting vehicles FY17 4

Agenda Group Financial Performance I India & SE Asia performance II Europe performance III Transition to Ind AS IV Appendix V 5

Global steel industry – Structural issues are being resolved % Mn T  Shrinking global steel demand, overcapacity & increasing China exports to world Vs Capacity utilization% 12 100 low priced exports by China continue to pose a threat to 10 sustained revival in realisations 90 8 80  Despite a rise in regulatory measures globally, China 6 exports for Jan-June rose by 9%, with June recording 70 4 second highest exports 60 2  Global steel production after declining for 16 consecutive 0 50 months stabilised in June. Jul-08 Jul-09 Jul-10 Jul-11 Jul-12 Jul-13 Jul-14 Jul-15 Jul-16 China exports to world(LHS) Capacity utilisation %(RHS) Consumption(MT) Vs Share of imports(%) Steel production trends 1.8% 4.2% 16% 15% 2.4% 7% 12% 10% 11% 0.8% -0.5% 56% 58% 58% -2.0% -2.7% -3.2% 143 -5.3% 80 -3.4% -11.6% -2.7% 137 77 135 74 -7.0% 9 10 9 -32.9% -38.7% EU(Excl UK) UK India FY14 FY15 FY16 World EU UK India China CY15 Q1 CY16 Q2 CY16 6 Source: WSA, Bloomberg

China underlying changes – Translating to better HRC realisations  China liquidity push boosted construction, infrastructure China Investment, Production and Sales(YoY Change%) and commodities which coupled with restocking and 20 10 frequent shutdowns during periods of national exposure 9 aided recovery in steel realisations 15 8 7  Spot HRC China FOB prices averaged US$ 420/t, the highest 10 6 level since Nov ’ 14. Prices have since corrected and currently at around US$ 390/t. 5 5  Increasing trade measures globally led to widening gap Fixed Asset Investment(LHS) Retail sales(LHS) Industrial production(RHS) between regional realisations HRC regional realizations – widening gap (US$/t) Raw material price trend(US$/t) 550 106 500 94 92 90 86 450 78 79 400 350 63 300 58 56 54 55 48 47 250 Q1CY15 Q2CY15 Q3CY15 Q4CY15 Q1CY16 Q2 CY16 July'16 62% Fe China CFR Spot HCC Spot FOB Australia Germany Domestic UK Domestic China FOB Mumbai Basic Domestic 7 Source: Bloomberg,CRU,CSO, Steel first

Highlights for the quarter  Group revenues of ` 26,406 crores on the back of improvement in realisations across geographies  Europe deliveries ex-Longs impacted by strategic volume reduction at UK  India deliveries stable  Group EBITDA of ` 3,270 crores, up 21% on yoy and 65% on qoq  India EBITDA stable at ` 2,236 Crs  Europe moves from a loss in Q4 FY16 to EBITDA of ` 856 Crs  EBITDA/t increase across all geographies  Commenced commercial operations at Tata Steel Kalinganagar 3MTPA plant  Divestment of Longs Products business in Europe completed.  Initiated discussions with strategic players in steel industry including Thyssenkrupp AG to explore feasibility of a potential JV for European business 8

Quarterly Financial Performance as per Ind-AS ` Crores Group India Q1 FY17 Q4 FY16 Q1FY16 Q1 FY17 Q4 FY16 Q1FY16 Deliveries(MT) 5.41 6.37 5.82 2.14 2.72 2.14 Turnover 26,406 27,558 28,025 10,323 11,736 10,175 Raw material Cost 6,923 6,363 7,764 2,308 2,159 2,330 EBITDA 3,270 1,982 2,693 2,236 2,240 1,897 EBITDA/t 6,047 3,111 4,626 10,455 8,242 8,850 PBET 1,080 -234 267 1,095 1,129 687 Exceptional items (168) (2,559) (145) (155) (289) 1 Profit/(loss) from discontinued (3,355) (97) (339) - - - operations and its disposal PAT (3,183) (3,320) (317) 575 528 425 Other comprehensive income 350 533 (1,872) 638 (102) (1,901) Total comprehensive income (2,833) (2,787) (2,189) 1,214 427 (1,476) Basic EPS (33.11) (34.82) (3.56) 5.63 4.85 4.08 9 * All figures on a continuing operations basis(excluding Longs Products Europe)

Quarterly Financial Performance- As per Ind-AS ` Crores Europe SEA Others & Eliminations Q1 FY17 Q4 FY16 Q1FY16 Q1 FY17 Q4 FY16 Q1FY16 Q1 FY17 Q4 FY16 Q1FY16 Deliveries(MT) 2.53 2.89 2.87 0.65 0.67 0.69 - - - Turnover 13,100 13,469 14,865 2,020 1,803 2,262 963 550 723 Raw material Cost 3,848 3,930 5,057 71 69 75 696 205 302 EBITDA 856 (578) 325 187 67 33 (9) 253 438 EBITDA/t 3,384 (1,996) 1,131 2,877 1,000 478 - - - 10 * All figures on a continuing operations basis(excluding Longs Products Europe)

Group EBITDA Bridge Q1 FY 2016 Vs Q1 FY 2017 ` Crores Non-Controllable - ( ` 163 Crs) Controllable - ` 1,187 Crs 1,230 3,280 3,233 (138) 2,256 145 1,514 2,093 249 (977) 189 (51) (477) (1,639) Q1 FY'16 Ind AS Q1 FY'16 Ind Revenue - Cost -Change Production Actuarial Others Adjusted Revenue - Cost -Volume Cost Central & Q1 FY'17 Ind IGAAP Adjustments AS Price Effect Effect Volume Changes EBITDA Vol/Mix & Mix Effect Efficiencies Others AS Note: Group EBITDA consists of EBITDA across four operating entities – TSI, TSE, NSH & TSTH 11

Debt movement in quarter ended 30 th June’16 ` Crores 86,204 325 85,475 2,634 772 81,975 232 4,229 75,259 10,216 Gross Debt Ind AS Impact Gross Debt Loans Movt Finance lease Forex impact Disposal of UK Gross Debt Jun 16 Cash, Bank & Net Debt Jun 16 Mar'16-IGAAP Mar'16-Ind AS obligation Longs Business Current Inv. Gross debt increased by ` 3,499 crores largely due to ` 2,442 crores of capex and increased finance lease obligation due to  commencement of Kalinganagar steel plant Net debt increased by ` 4,171 crores  Strong liquidity of ~ ` 17,200 crores including Cash & cash equivalent, current investments and undrawn credit lines  12

Agenda Group Financial Performance I India & SE Asia performance II Europe performance III Transition to Ind AS IV Appendix V 13