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  • May 4, 2022 - Tata Steel Announces Dividend and Stock Split. 5 Takeaways from the Company's Q4 Earnings

Tata Steel Announces Dividend and Stock Split. 5 Takeaways from the Company's Q4 Earnings

May 4, 2022

Tata Steel Announces Dividend and Stock Split. 5 Takeaways from the Companys Q4 Earnings

Tata Steel, which announced its March quarter results yesterday, has come under the radar after posting good numbers.

The Tata group company also announced a hefty dividend and sub-division of its shares.

Here are five key takeaways from the company's March quarter results:

  • The steel major reported around 37% jump in its net profit at Rs 98.4 bn. This compared to Rs 71.6 bn profit posted in the year ago quarter.
  • The company's revenue from operations rose 38% to Rs 693.2 bn for the three months period as against Rs 500.3 bn in the year ago period.
  • In India operations, the company achieved highest ever annual crude steel production of 19.06 m tons, with a growth of 13% YoY.
  • For full financial year 2021-22, Tata Steel clocked a net profit of Rs 417.5 bn, which translates into a more than five-fold jump from previous fiscal's figure of Rs 81.9 bn.
  • The board of directors also recommended a dividend of Rs 51 per fully paid equity share and Rs 12.75 per partly paid equity share.

Tata Steel became the Tata group company's most profitable company, surpassing Tata Consultancy Services (TCS) after several years, aided by rising steel prices due to commodity supercycle.

Stock split

Tata Steel approved a proposal to split its shares in the ratio of 10-to-1.

The split, however, is subject to regulatory and statutory approvals.

The record date for the same will be decided by Tata Steel's board and will be intimated to the exchanges soon.

A company usually opts for a stock split to make its shares more affordable and increase liquidity in the stock.

How Tata Steel has performed lately

Tata Steel share price opened the day marginally higher today after posting its results yesterday.

The stock opened at Rs 1,330 against its previous close of Rs 1,295.1. It quickly erased gains and is currently trading on a flat note.

Over the year gone by, shares of Tata Steel have gained 22%.

From a trailing twelve months perspective, the company's shares are trading at 5.4 times its earnings (P/E) and at 1.4 times its book value (P/B). The historical P/E average of Tata Steel stands at 6.4 and P/B is 1.5.

The two closest competitors of Tata Steel are SAIL and JSW Steel. SAIL trades on a PE multiple of 3.2 and a P/BV multiple of 0.8 whereas JSW Steel has a PE of 9.9 and 2.9 P/B.

About Tata Steel

Tata Steel is Asia's first integrated private steel company.

The company is primarily engaged in the business of manufacturing and selling finished steel goods.

It's present across the value chain, from the mining of iron ore and coking coal to the distribution of steel, and value-added products.

The company caters to several industries through its broad product portfolio, including automobiles, construction, agriculture, industrial and general engineering. It also has a global presence and caters to the steel needs of over 50 countries across five continents.

To know more about the company, check out Tata Steel's financial factsheet and its latest quarterly results.

You can also compare Tata Steel with its peers.

Tata Steel vs SAIL

Tata Steel vs JSW Steel

Tata Steel vs Jindal Stainless

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...

Yash Vora

Yash Vora is a financial writer with the Microcap Millionaires team at Equitymaster. He has followed the stock markets right from his early college days. So, Yash has a keen eye for the big market movers. His clear and crisp writeups offer sharp insights on market moving stocks, fund flows, economic data and IPOs. When not looking at stocks, Yash loves a game of table tennis or chess.

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