Tata steel stock hits an all-time high after strong production and delivery numbers

Tata Steel shares rose 1.1% on Monday, after the company reported a spike in production and delivery numbers from businesses across India. The production of crude steel for Q4FY24 increased by 4.5% YoY to 5.38 million metric tonnes (MT). The deliveries of the products across India also surged 5% YoY to 5.41 MT, marking the highest quarterly deliveries in the history of Tata Steel.

The company achieved its highest ever annual crude steel production of 20.8 MT in FY24. This represents a 4% increase YoY driven by unlocking initiatives across various sites and strong production at Neelachal Ispat Nigam. Deliveries for FY24 also reached a new high of 19.9 MT, reflecting a 5.6% YoY growth.

This was the primary reason for the strong market performance of the company. The stock closed 1.5% higher at ₹164.90 on the NSE on Monday. The company's market capitalisation also crossed ₹2.05 lakh crore.

In Q3FY24, Tata Steel witnessed a positive turnaround in profitability. The company reported a consolidated net profit of ₹522 crore, reversing losses incurred in both the preceding quarter and the corresponding period of the previous financial year. Despite a 3% YoY decline in consolidated sales to ₹55,312 crore, Tata Steel's profitability improved significantly.

This positive shift was mainly due to a substantial increase in earnings before interest, tax, depreciation, and amortisation (EBITDA). Compared to Q3FY23, EBITDA surged by more than 50% to ₹6,334 crore, indicating improved operational efficiency and cost management strategies.