Tata Steel to Set Up 3mtpa Electric Arc Furnace at Port Talbot
Tata Steel has announced a proposal to set up a 3 million tonne per annum (mtpa) Electric Arc Furnace (EAF) at its Port Talbot steel making facility in the UK, with a capital expenditure (capex) of GBP 1.25 billion. The proposed project will receive a GBP 500 million grant (40% of the project cost) from the UK government and adequate policy support for a smooth transition to green steel making in the UK at a competitive landscape.
The first stage of the process is complete with this agreement, and consultations with unions involved are expected to close in the next three months. Capex is planned over the next three years post successful consultation and subject to relevant regulatory approvals.
Benefits of the Transition
We believe that the Tata Steel UK (TSUK) transition is EPS accretive for the following reasons:
- Current cash losses will end, as the company will import substrate instead of producing it at old facilities.
- There will be one-time costs, but TSUK is expected to be in a better situation than in the earlier case of recurring cash burn.
- Volatility in coking coal prices will not directly affect TSUK earnings.
- Energy costs are likely to fall as the UK moves towards renewable sources.
We revise our FY25E EBITDA estimates upwards by 5% to Rs 411 billion and introduce FY26E earnings estimates. We maintain a ‘Buy’ rating at a revised target price of Rs 144 (Rs 137 earlier), assigning an EV/EBITDA multiple of 5x for FY25E EBITDA for Tata Steel Europe (TSE).
- 22 Sep
NBCC shares trade higher on Rs 100 crore work order from SAIL
NBCC shares were trading 3 percent higher on September 22 after the company announced having bagged a work order worth Rs 100 crore from SAIL. This is the fourth order-win announced by the company in this month, the total value of the same being Rs 450 crore. NBCC is a public sector undertaking engaged in the business of construction and real estate development. The company specializes in providing project management, consultancy and engineering services for civil construction, infrastructure development, and real estate projects.
- 22 Sep
Glenmark Pharma stock falls on stake sale in Glenmark Life Sciences
Glenmark Pharma stock fell after the company announced it would sell a 75% stake in its subsidiary Glenmark Life Sciences to Nirma. Analysts expect the stake sale to benefit Glenmark Pharma, as it will transition from a net debt position to a cash surplus position. This is expected to have a positive impact on the company's return ratios over the next two to three years.
- 22 Sep
Berger Paints Shares Hit 52-Week High After Turning Ex-Bonus
Berger Paints shares surged 6% to hit a 52-week high after turning ex-bonus on the record date for the issue of bonus shares in the ratio 1:5. The company posted a net profit of Rs 326.3 crore in the April-June quarter of FY24, up 39% year-on-year, on revenue of Rs 2,739.7 crore, up 10% year-on-year. The company expects to get net cash positive by the end of this fiscal year and expects to end the year with double-digit revenue growth on strong demand outlook.
- 22 Sep
Market Update for September 22, 2023
IdeaForge Tech up 3.4% on order RVNL up 3% on highway MoU JSW Steel up 0.4% on sale ICICI Lombard down 1.6% on CEO exit ICICI Bank down 1% on healthcare investment NHPC up 1.3% on extended additional charge Kalyani Forge up 3.2% on new MD IRB Infra up 2.5% on road project closure
- 22 Sep
Lux Industries Shares Down 3% After Income Tax Raid
Lux Industries shares fell 3% on September 22 after news emerged that the Income Tax department had conducted searches at the company's premises in Kolkata and alleged a tax evasion of Rs 200 crore. The company has confirmed the searches and is extending full support.