Helping You Build Wealth With Honest Research
Since 1996. Try Now

MEMBER'S LOGIN

MEMBER'S LOGINX

     
Invalid Username / Password
   
     
   
     
 
Invalid Captcha
   
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Markets will remain closed on May 20, 2024 on account of Parliamentary Elections.

Tata Steel sees revival in Europe
Fri, 28 May 11:30 am

Indian indices continue to tread higher after of paring some the opening gains during the previous two hours of trade. Stocks from metal and realty sectors are seeing maximum buying interest while some buying interest is seen in stocks from the banking and oil & gas space as well.

BSE-Sensex is trading up by 120 points while NSE-Nifty is trading 33 points above the dotted line. BSE-Midcap index is trading higher by 1.3% while the BSE-Smallcap index is trading 1.2% above yesterday’s closing. The rupee is trading at 46.61 to the US dollar.

Steel manufacturing major Tata Steel declared its FY10 results yesterday. The company’s consolidated top line fell by 31% YoY as a result of lower deliveries. The company, however, got a boost in the second half of the year on recovery in steel demand after a steep decline in the first half of the year. Operating margins of the company fell by 4.4% to close the year at 7.9%. This was due to lower selling price and change in sales mix. However, the second half was better than the first as a result of better utilization rates in Europe. As a result, the operating profits were 15 times higher in 2HFY10 than in 1HFY10. Bottom line for the company however turned in negative as a result of lower operating profits, higher tax outgo and restructuring costs. Going forward, the company is expected to perform better as demand for steel picks up.

As per a leading financial daily, wind turbine maker, Suzlon Energy, could issue fresh shares to raise money for paying off its debt. For this purpose the company is considering a rights issue. However, the company has not given any details for the same.

The company has been facing problem because of high debt and raising equity through a rights issue seems to be the only option for the company as of now. It may be recalled that the company had sold its 35% stake in Hansen Transmissions International NV in November 2009 to reduce its debt. The company has been grappling with high debt for quite some time. In fact, the company’s interest costs increased by 51% for 9mFY10 while sales fell by 14% YoY. The company has high financial and operating leverage. With no turnaround in business in sight, the company’s position seems to be quite precarious.

For information on how to pick stocks that have the potential to deliver big returns, download our special report now!

View all commentaries | Archives

Read the latest Market Commentary


Equitymaster requests your view! Post a comment on "Tata Steel sees revival in Europe". Click here!

  
ABOUT EQUITYMASTER

Since 1996, Equitymaster has been the source for honest and credible opinions on investing in India. With solid research and in-depth analysis Equitymaster is dedicated towards making its readers- smarter, more confident and richer every day. Here's why hundreds of thousands of readers spread across more than 70 countries Trust Equitymaster.

PREMIUM PRODUCTS
QUICK LINKS
POPULAR TOPICS
TRENDING TOPICS
FREE NEWSLETTERS
EQUITYMASTER SUPPORTS
  • HelpYourNGO
  • You Tube
  • Linkedin
  • Twitter
  • Telegram
  • Google Play

Copyright © Equitymaster Agora Research Private Limited.

Whitelist | Refer | Terms | Privacy | Contact | About | Sitemap

Phone +91-9136015013

Equitymaster Agora Research Private Limited (Research Analyst)
SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Email: info@equitymaster.com. Website: www.equitymaster.com.
CIN:U74999MH2007PTC175407

Name of the Compliance & Grievance Officer: Ms Sonal Ramachandran
Telephone: +91-22-61434003 | Email: compliance@equitymaster.com

LEGAL DISCLAIMER:
Investment in securities market are subject to market risks. Read all the related documents carefully before investing.
Registration granted by SEBI and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.

All rights reserved. Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

Equitymaster Agora Research Private Limited (Research Analyst) bearing Registration No. INH000000537 (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA, Canada or the European Union countries, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.