Tata Steel Limited · NSE:TATASTEEL
Tata Steel — Investor Presentation (February 2008)
26 slides from Tata Steel's investor presentation, February 2008
Slide 1: Towards Growth & Globalisation
Towards Growth & Globalisation February 2008 Strictly Private and Confidential
Slide 2: Disclaimer
Disclaimer Statements in this presentation describing the Company’s objectives, projections, estimates, expectations may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important
Slide 3: The Tata Group
The Tata Group 139 Years Old Strong Brand Equity Group Revenues US$ 28.8 billion Total Sales 3.2% of India’s GDP International Income 38% of Group Revenue India’s Largest Employer in the Private Sector Over 289,500 employees Leadership 3 All figures FY’07 Estimates
Slide 4: Strong Sponsorship from the Tata Group
Strong Sponsorship from the Tata Group Group Revenue US$28.8 billion (FY07) Engineering Materials Energy Chemicals Consumer Services Communication Products and Information System Leadership in Leading auto company in India in terms Largest integrated tea company in India of revenues Sixth largest st
Slide 5: Steel Industry: Robust Demand
Steel Industry: Robust Demand
Slide 6: Key Growth Trends
Key Growth Trends Global Steel Prices World Steel Consumption 4.6% 1,616 1,321 US$/t 800 3.3% 547 1,026 684 600 757 411 394 328 5.4% 392 306 658 400 240 489 327 124 2000 2005 2010P 2015P 200 50% 62% 62% 66% 2008 Q1 2003 2004 2005 2006 2007 Steel Demand in Developed Economies Global Steel Demand Stee
Slide 7: Industry Capacity Utilisation High but Expected to Ease
Industry Capacity Utilisation High but Expected to Ease Global excess effective capacity and utilisation 350 100% Utilisation 300 95% 93% Excess effective capacity 250 Capacity utilisation 200 91% 91% 90% (%) 88% (mt) 90% 89% 88% 150 85% 84% 100 84% 83% 80% 50 80% 79% 79% Excess effective capacity 0
Slide 8: Increasing Internationalisation Leading to Consolidation
Increasing Internationalisation Leading to Consolidation Despite recent consolidation, the global steel market remains highly fragmented. — Consolidation is leading to – Low production costs and improved marketing presence through economies of scale – Rational supply side discipline, including throu
Slide 9: Tata Steel: Achieving Global Leadership
Tata Steel: Achieving Global Leadership
Slide 10: Tata Steel Limited ("TSL") – Overview
Tata Steel Limited (“TSL”) – Overview Established in 1907. Asia’s first and India’s largest integrated private sector steel producer With Corus acquisition, TSL is the world’s sixth largest steel producer with presence in nearly 50 countries Diversified product portfolio catering to markets includin
Slide 11: Tata Steel and Corus: A Compelling Vision in Steel
Tata Steel and Corus: A Compelling Vision in Steel Improved Cost Positioning Ongoing Synergies: Cross fertilisation of R&D capabilities and operational best practices; supply of raw materials and semifinished steel from lower cost operations Lower Procurement Costs: Economies of scale and increased
Slide 12: Globalized Suite of Major Facilities
Globalized Suite of Major Facilities Access to new markets and presence across steel value chain, significantly enhances customer reach. EU EU(excl UK and Netherlands) Distribution Centres UK and Ireland Three Production Facilities Distribution Centres Capacity: 14.4 mt US Netherlands Distribution C
Slide 13: Sector-leading Growth
Sectorleading Growth Expansion in Existing Facilities CorusIJmuiden Plant Jamshedpur — New continuous galvanising line and new threestand cold rolling mill — Increase production capacity of automotive market products and ability to 5.0 6.8 By June 2008 produce specialty high strength steel grades
Slide 14: Significant Upstream Integration
Significant Upstream Integration Iron Ore Coal 10.8 Coal Extracted (MT) 11.0 8.0 Mined (MT) 7.0 10.0 9.8 7.0 6.5 9.0 6.0 FY06 FY07 FY06 FY07 126 kms 188 kms West Bokaro Naomundi Jamshedpur 153 kms 153 kms Jharia Joda 244 kms Haldia Port 150 kms Khondbond 511 kms Paradip Port — Noamundi mine: A fully
Slide 15: Building Raw Material Security for Global Operations
Building Raw Material Security for Global Operations Mozambique Coal Projects — JV agreement with Riversdale Mining Limited for Benga & Tete coal tenements – 35% equity stake for A$100 million — Owns 25,000 hectares of coal tenement with Inferred coal resource of ~1.225 billion tons in Benga — Produ
Slide 16: Leading Sales and Distribution Capability
Leading Sales and Distribution Capability Indian Sales and Distribution Corus Sales and Distribution — Approximately 91% of saleable steel sales are to the Indian market — Direct sales to end users — Principal sectors – Highvolume customers — Stockholders and service center businesses – Operations
Slide 17: Management Structure
Management Structure Board Group Corporate Functions Executive Committee Executive Committee MD CEO Technology & Integration* COO Finance* COO Strategy* Communications Director South East Asia Global Minerals Strip Products Division Director VP Engineering & Projects Long Products Division Director
Slide 18: Competitor Comparison
Competitor Comparison Tata Steel has been ranked as one of the top 3 global steel makers in five out of past seven years. Ranking 2001 2002 2003 2004 2005 2006 2007 1 Posco Posco Posco Severstal 2 Usinor Nucor Bao Steel Severstal Posco Posco Posco 3 Posco Bao Steel Severstal Bao Steel Arcelor Mittal
Slide 19: Financial Overview
Financial Overview
Slide 20: Steel Sales Volumes
Steel Sales Volumes Tata Steel – ex. Corus Corus MT MT 8.39 9 25 20.94 20.88 19.79 8 6.62 20 7 6.2 6.46 6 5.15 6.45 15 5 4.09 3.49 5.11 5.61 4 4.75 10 1.46 3 2 5 3.13 3.24 9.57 8.59 8.87 2.63 1 0 0 Mar05 Mar06 Mar07 Dec04 Dec05 Dec06 Flat Long Strip Long Distri & Buldg Products 20
Slide 21: Financial Overview
Financial Overview Net Sales EBITDA PAT Tata Steel – ex. Corus Tata Steel – ex. Corus Tata Steel – ex. Corus $5.85 Bn $1.73 Bn $0.96 Bn 300 80 75 45 50 25 252 70 63 40 42 250 62 203 35 40 36 37 20 60 EBITDA Margin 200 EBITDA Margin 30 160 50 Rs. Bn 30 15 Rs. Bn 25 Rs. Bn 150 40 20 100 30 20 10 15 20
Slide 22: Financing Update
Financing Update — Financing of the Corus Transaction of US$ 14 billion: – Syndication of £3,670 million completed – CARS issue of US$ 875 million – Rights Issue of US$ 2,200 million — Bridge Loans of US$ 2.90 billion has been repaid 22
Slide 23: Strategies and Strengths
Strategies and Strengths
Slide 24: Strategies
Strategies Strengthen Indian Operations — Single location — Multi location — World class — Strong regional presence — Small in size — Auto and Realize Synergies from the Corus Acquisition packaging and construction led Seek and Maintain Control Over Raw Material 2006 2015 Focus on High Growth in Eme
Slide 25: TSL – A Compelling Vision
TSL – A Compelling Vision Tata Steel is set to capitalize on the strong growth opportunities on a global basis. ü Strong position in the Indian market with continued investments ü Strong position in Western Europe with strategically located production facilities and global sales and distribution net
Slide 26: TATA
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