Introduction

Backed by 100 glorious years of experience in steel making, Tata Steel is

among the top ten steel producers in the world with an existing annual crude
steel production capacity of 30 Million Tonnes Per Annum (MTPA). Established
in 1907, it is the first integrated steel plant in Asia and is now the world`s
second most geographically diversified steel producer and a Fortune 500
Company.
Tata Steel has a balanced global presence in over 50 developed European
and fast growing Asian markets, with manufacturing units in 26 countries.
It was the vision of the founder; Jamsetji Nusserwanji Tata., that on 27th
February, 1908, the first stake was driven into the soil of Sakchi. His vision
helped Tata Steel overcome several periods of adversity and strive to
improve against all odds.
Tata Steel`s Jamshedpur (India) Works has a
crude steel production capacity of 6.8 MTPA
which is slated to increase to 10 MTPA by
2010.
The Company also has proposed three
Greenfield steel projects in the states of
Jharkhand, Orissa and Chhattisgarh in India
with additional capacity of 23 MTPA and a
Greenfield project in Vietnam.

Through investments in Corus, Millennium Steel (renamed Tata Steel

Thailand) and NatSteel Holdings, Singapore, Tata Steel has created a
manufacturing and marketing network in Europe, South East Asia and the
pacific-rim countries. Corus, which manufactured over 20 MTPA of steel in
2008, has operations in the UK, the Netherlands, Germany, France, Norway
and Belgium.
Tata Steel Thailand is the largest producer of long steel products in Thailand,
with a manufacturing capacity of 1.7 MTPA. Tata Steel has proposed a 0.5
MTPA mini blast furnace project in Thailand. NatSteel Holdings produces
about 2 MTPA of steel products across its regional operations in seven
countries.
Tata Steel, through its joint venture with Tata BlueScope Steel Limited, has
also entered the steel building and construction applications market.
The iron ore mines and collieries in India give the Company a distinct
advantage in raw material sourcing. Tata Steel is also striving towards raw
materials security through joint ventures in Thailand, Australia, Mozambique,
Ivory Coast (West Africa) and Oman. Tata Steel has signed an agreement
with Steel Authority of India Limited to establish a 50:50 joint venture
company for coal mining in India. Also, Tata Steel has bought 19.9% stake in
New Millennium Capital Corporation, Canada for iron ore mining.
Exploration of opportunities in titanium dioxide business in Tamil Nadu, ferrochrome plant in South Africa and setting up of a deep-sea port in coastal
Orissa are integral to the Growth and Globalisation objective of Tata Steel.
Tata Steels vision is to be the global steel industry benchmark for Value
Creation and Corporate Citizenship.
Tata Steel India is the first integrated steel company in the world, outside
Japan, to be awarded the Deming Application Prize 2008 for excellence in
Total Quality Management.

THE TATA GROUP

Before we discuss at the length of the company, we would like to throw some
light on the Tata Group of companies in present day India.
Tata Steel is one of the ventures of the Tat Group but it has many successful
companies under one umbrella. Some of the other notable Tata concerns and
their lines of businesses are shown below.

VISION OF THE COMPANY

COMPETITION
Tata Steel is undoubtedly the best steelmaker in the wrold. It produces the
cheapest and best quality of steel in the world. In the last seven years the
position of Tata Steel has reduced drastically because of Corus acquisition.
The results of the acquistion will be profitable after 2010.

MAJOR LOCAL STEEL PLAYERS

Corporate profile
Essar is a multinational corporation with annual revenues of US$39
billion and investments in Steel, Energy, Infrastructure and
Services. With operations in more than 29 countries, it
employs over 60,000 people.
Essar began as a construction company in 1969 and has diversified into
manufacturing, services and retail over the years since then. Over the last
decade, it has grown through strategic global acquisitions and partnerships,
or through greenfield and brownfield development projects, capturing new
markets
and
discovering
new
raw
material
sources.
Today, Essar continues to expand its global footprint, focusing on markets
in Asia, Africa, Europe, the Americas and Australia. Essar invests
significantly in the latest technology to drive forward and backward integration in its businesses,
and on leveraging synergies between these businesses. It also focuses on in-house research and
innovation to be a low-cost manufacturer with high-quality products and innovative customer
offerings.
Essar Global Fund Limited (Essar Fund) is an investment fund managed by its investment
manager Essar Capital Limited. The Fund is a global investor, controlling a number of worldclass assets diversified across the core sectors of energy, metals and mining, infrastructure
(comprising ports and EPC businesses) and services (primarily comprising shipping and BPO
businesses). The aggregated revenues of the Funds portfolio companies total US$35 billion. The
Funds portfolio companies employ over 60,000 people across 29 countries, and have adopted
international standards of health, safety, environmental protection and corporate governance.
Alongside its ambitious business pursuits, Essar has been committed to its social responsibility.
The company runs community outreach initiatives at all of its plant locations, with a focus on
education, healthcare, environmental and agricultural development, and self-employment. Essar
is committed to sustainable business practices. Its Health, Safety and Environment (HSE)
management system is on par with global standards.
The company is also actively undertaking climate change initiatives to reduce its carbon
footprint. This includes several Clean Development Mechanism (CDM) projects that earn the
company 'Certified Emission Reduction' credits. A growing number of its businesses with new

businesses joining the list every year are certified to international environment standards,
including ISO 9001 /14001, and health and safety standards, such as OHSAS 18001.
Essar is widely regarded as a responsible and conscientious global employer. It has experience in
managing businesses in different geographies with a culturally diverse workforce. This is why its
people practices are sensitive to cross-cultural nuances. The company's people strategy is
focused on promoting a learning culture that continually enhances the professional skills of its
employees.
A look at Essar's areas of business:
Steel
Essar has a significant global presence in steel and an international portfolio of iron ore and coal
mines.
Essar Steel is a global steel producer with a footprint in India, Canada, USA, the Middle East
and Asia. It has an annual capacity of 14 million tonnes, and aims to achieve a global capacity of
20-25 million tonnes. It has a significant presence in the key markets of Asia, Europe, Africa and
North America. The company has specialized plants for value-added steel products such as pipes
and plates and has a leadership position in the cold rolling, galvanizing and pre-coated segments.
Essar Minerals owns a growing portfolio of iron ore and coal mines in India, Indonesia,
Mozambique and the USA. It also has an iron ore prospecting license in Brazil and various states
in India. The company has access to over 1.6 billion tonnes of iron ore reserves and 450 million
tonnes of coal reserves.
Energy
Essar Energy is a world-class, low-cost, integrated energy company focused on India and
positioned to capitalize on India's rapidly growing energy demand. We have an established trackrecord and assets worth US$12 billion across the power and oil and gas industries. The combined
assets of Essar Power and Essar Oil constitute Essar Energy.
Essar Oil is a fully integrated oil and gas company of international scale with a strong presence
across the hydrocarbon value chain from exploration and production to oil retail. The company
has access to a global portfolio of conventional and unconventional, onshore and offshore oil and
gas blocks, with about 35,000 sq km available for exploration. The company is also the largest
coal bed methane (CBM) player in India. Currently, Essar Oil India has over 405,000 barrels per
stream day (bpsd) of crude refining capacity at Vadinar in Gujarat, India.
Essar Oil UK, which operates the 296,000 bpsd refinery at Stanlow in Cheshire, United
Kingdom,
meets
15%
of
UKs
auto
fuel
demand.
Essar Oil has over 1,400 Essar-branded oil retail outlets in various parts of India. Essar has also
embarked upon entering the African retail market by opening its first retail outlet in Kenya.

Essar Power is among India's top private sector power producers with a current generation
capacity of 3910 MW spread across eight power plants in India and Canada.
It is one of the lowest-cost power producers and owns about 500 million tonnes of coal reserves
and resources in blocks spread across four continents.
Infrastructure
Essar has a strong foundation in infrastructure projects, with proven capability in managing ports
and handling large, complex engineering, procurement and construction projects.
Essar Ports is one of the largest owners and operators of ports in India. The company has an
existing aggregate capacity of 104MMTPA across three facilities located at Vadinar
(58MMTPA), Hazira (30MMTPA) and Paradip (16MMTPA) in the state of Gujarat and Odisha,
on the west and east coast of India. It is currently in the process of increasing its aggregate ports
capacity to 194MMTPA at a number of locations across India.
Essar Projects is the second largest engineering, procurement and construction (EPC)
companies in India. Its EPC capabilities have helped build all of Essar's industrial assets in India
in the sectors of steel, oil and gas, power, and ports and terminals. The company is increasingly
using its expertise to execute large external projects across the world.

Steel
SEAMLESS INTEGRATION
A major strategic advantage is our high level of forward and backward integration. We are totally
integrated from raw material to finished products adding value at every stage of the
manufacturing process. Our areas of operation include:
Iron ore beneficiation
We have an 8 MTPA plant at Bailadilla (Chhattisgarh) and a 12 MTPA plant at Dabuna (Odisha),
both strategically established to leverage the rich iron ore deposits of the respective states. The
plants pump the iron ore slurry to Essar Steel pellet plants at Visakhapatnam (Andhra Pradesh;
267 km pipeline) and Paradip (Odisha; 253 km pipeline) respectively.
Pelletization
We have an 8 MTPA pelletization plant at Visakhapatnam and a 6 MTPA pellet plant at Paradip,
both of which provide vital raw material to our steel plant at Hazira (Gujarat).
Iron and steel
We have a fully integrated world-class facility at Hazira, housing the world's fourth largest
single-location steel plant. It has a steel-making capacity of 10 MTPA, holds ISO: 9001:2000, IS
9002 and TUV, and ISO 140001 certification and is India Chiller Energy Efficiency Project
(ICEEP) Protocol compliant.

The facility also houses a 6.8 MTPA sponge iron plant (the world's largest gas-based sponge iron
plant in a single location); a 1.5 MTPA plate mill (the largest in India); a 0.6 MTPA pipe mill
with with internal and external coating facilities of up to 2 million square meters annually; and a
1.4 MTPA cold rolling complex comprising two galvanizing lines, a batch annealing furnace and
a skin pass mill.
Steel processing
We have a downstream capability hub at Pune (Maharashtra),which houses a 0.6 MTPA cold
rolling plant, a 0.5 MTPA galvanizing plant, a 0.4 MTPA color coating plant, and a 0.65 MTPA
pickling line.

Our history
Since its inception, ArcelorMittal has rapidly grown through a successful consolidation strategy
with a number of significant acquisitions
ArcelorMittal is the successor to Mittal Steel, a business originally set up in 1976 by
Mr Lakshmi N Mittal, chief executive officer and chairman of the board of directors.
ArcelorMittal was created through the merger of Arcelor and Mittal Steel in 2006.
Mittal Steels rapid growth since 1989 has been the result of combining a successful
consolidation strategy with a number of significant acquisitions.
Since setting up operations in Trinidad and Tobago in 1989, some of its major acquisitions are
Siderurgica del Balsas (Mexico) in 1992, Sidbec (Canada) in 1994, Karmet (Kazakhstan) and
Hamburger Stahlwerke (Germany) in 1995, Thyssen Duisburg (Germany) in 1997, Inland Steel
(US) in 1998, Unimetal (France) in 1999, Sidex (Romania) and Annaba (Algeria) in 2001, Nova
Hut (Czech Republic) in 2003, BH Steel (Bosnia), Balkan Steel (Macedonia), PHS (Poland) and
Iscor (South Africa) in 2004, ISG (US), Kryvorizhstal (Ukraine), as well as a significant interest
in Hunan Valin Steel (China) in 2005, and three Stelco Inc. subsidiaries (Canada) in 2006.
Arcelor was created in February 2002 through the merger of Arbed (Luxembourg) founded in
1911, Aceralia (Spain) and Usinor (France). Arcelor also had major steel production facilities in
Belgium, Germany, Italy, Brazil and Argentina.
Arcelor acquired a controlling interest in Companhia Siderurgica Tubarao (now a part of
ArcelorMittal Brasil) in 2004, Huta Warszawa (Poland) in 2005, a controlling interest in Sonasid
(Morocco), as well as Dofasco (Canada) in 2006.

At the time of the merger with Mittal Steel, Arcelor was the second largest steel producer in the
world.
In 2007 the newly merged ArcelorMittal continued to pursue an expansive growth strategy, with
35 transactions announced worldwide.
At the beginning of 2008 ArcelorMittal continued to make investments, with significant
transactions announced in Australia, Brazil, Canada, Costa Rica, France, Russia, South Africa,
Sweden, Turkey, United Arab Emirates, the US and Venezuela, the majority of which were
completed. But in light of the deteriorating economic situation during 2008, ArcelorMittal
suspended most investment activity by the end of the year.
Post-crisis, ArcelorMittal has cautiously restarted certain projects to capture growth in key
emerging markets and mining. Capital expenditure on mining doubled in 2011 to almost US$1.3
billion, as the group embarked on a major development programme aimed at expanding existing
mines and developing new ones.
ArcelorMittal has put considerable emphasis on growing its mining business. The company is
making continued progress on the plan to increase iron ore production capacity from 56 million
tonnes in 2012 to 84 million tonnes in 2015 in the company-owned mines.
This year ArcelorMittal has re-started a number of steel development projects, including the
optimisation of the galvanizing operations in Dofasco, the first phase of the Monlevade
expansion in Brazil, as well as further investment in Juiz de Fora to raise melt shop and rebar
capacity. In Argentina, a construction of a new rolling mill was announced.
Recently, ArcelorMittal, together with its partner Nippon Steel and Sumitomo Metal, acquired
ThyssenKrupp's Calvert facility in the US. This is a strategic acquisition for ArcelorMittal,
demonstrating the companys industry leadership and continued ability to capture valueenhancing opportunities.
Leadership at ArcelorMittal
Leadership is an integral part of ArcelorMittal: it is one of our three core values of sustainability,
quality and leadership, which shape every aspect of our corporate behaviour and help us meet
our promise of transforming tomorrow.
Our leadership position in the steel industry is the result of a consistent management strategy that
focuses on product diversity, geographic reach and diversification we are industry leaders in
terms of new technology, sustainability and corporate responsibility.
We are also leaders internally, in our efforts to improve health and safety, training,
competitiveness and employee engagement.

Every organisation needs leadership at every level. We believe leaders should inspire,
influence, motivate and engage people. Leadership should inspire our employees to work at a
level that they would not normally reach or go to on their own.
The next generation
To safeguard the future of ArcelorMittal, we are committed to developing the next generation of
leaders through initiatives such as ArcelorMittal Universitys leadership academy and the global
employee development programme (GEDP)
We want to ensure there is a succession of motivated employees capable of becoming the next
generation of leaders, together with a diverse and highly skilled workforce that can help us meet
our business and organisational needs around the world.
We strive to improve management and leadership capabilities from within, and create
opportunities for those employees who have been identified as future leaders through
professional and personal growth. This means providing inspiring and effective leadership, open,
transparent communication and excellent learning and development opportunities.
As part of our leadership role, we also recognise that the company has a duty to its stakeholders
to operate in a responsible and transparent manner and to safeguard the wellbeing of all its
stakeholders, including employees, contractors and the communities in which it operates.
Through good leadership, we aim to nurture a culture that values, recognises and rewards
individual performance.

JSW Steel Ltd

JSW Steel Ltd. (BSE: 500228, NSE: JSWSTEEL) is an Indian steel company owned by the
JSW Group based in Mumbai, Maharashtra, India.[2] JSW Steel, after merger of ISPAT steel, has
become India's largest private sector steel company with an installed capacity of 14.3 MTPA.[3]
As part of the US $18 billion O. P. Jindal Group, JSW Group has diversified interests in steel,
energy, minerals and mining, infrastructure, cement and information technology.[4] JSW's history
can be traced back to 1982, when the Jindal Group acquired Piramal Steel Limited, which
operated a mini steel mill at Tarapur in Maharashtra and renamed it as Jindal Iron and Steel
Company (JISCO).[5]
The Group set up its first steel plant in 1982 at Vasind near Mumbai. Soon after, it acquired
Piramal Steel Ltd., which operated a mini steel mill at Tarapur in Maharashtra. The Jindals, who
had wide experience in the steel industry, renamed it as Jindal Iron and Steel Co. Ltd. (JISCO).
Jindal Vijayanagar Steel Ltd. (JVSL) was set up in 1994, with its plant located at Toranagallu in
the Bellary-Hospet area of Karnataka, the heart of the high-grade iron ore belt and spread over

3,700 acres (15 km2) of land. It is just 340 kilometres (210 mi) from Bangalore, and is well
connected with both the Goa and Chennai Port. In 2005, JISCO and JVSL merged to form JSW
Steel Ltd.
JSW Steel has also formed a joint venture for setting up a steel plant in Georgia. The Company
has also tied up with JFE Steel Corp, Japan for manufacturing the high grade automotive steel.
The Company has also acquired mining assets in Republic of Chile, United States and
Mozambique.

History
In 1994, Jindal Vijayanagar Steel (JVSL) was set up with its plant located at
Toranagallu in the Bellary-Hospet area in the State of Karnataka, the heart of
the high-grade iron ore belt and spread over 10,000 acres (40 km2) of land.[6]
over a decade. It also set up a plant at Salem with an annual capacity of 1
million tonne. It is on the threshold of a major expansion plan of adding 3.2
million tons per annum to its at Vijayanagar Plant to achieve 11 MTPA by
2011. It has established a strong presence in the global value-added steel
segment with the acquisition of a steel mill in US and a Service Center in
United Kingdom. JSW Steel has also formed a joint venture for setting up a
steel plant in Georgia. The Company has further acquired iron ore mines in
Chile and coal mines in USA & Mozambique.The current manufacturing
capacity of company is 14.3 MTPA. [7] In Aug 2014, it acquired Welspun
Maxsteel Ltd in a deal valued at around 1,000 Crores. [8] JSW has already
acquired 3 MTPA Hot Rolling Plant in Dolvi maharashtra ( earlier named Ispat
Industries Ltd).

Facilities
Vijayanagar Works
Indias first 10 MTPA steel plant at single location, the fastest growing steel plant in India. The
JSW Steel Vijayanagar plant is the first integrated steel plant to reach 10 MTPA capacity in a
single location. It is the first in India to use the Corex technology for hot metal production.Now
other steel plants are coping the same.
The first hot strip mill at Vijayanagar was commissioned in 1997. Since then it has grown
exponentially and now has an installed capacity to produce 10 MTPA of steel. Located at a
remote village Toranagallu part of under developed North Karnataka in the Bellary-Hospet iron
ore belt of Karnataka, the fully integrated steel plant, is well-connected with both the Goa and
Chennai ports.
Unique features:

Regarded as the worlds Corex showpiece; it was the first Greenfield project in India and
among the first in the world to have successfully used this technology to produce green
steel
Houses Indias largest blast furnace and the widest hot strip mill

The only plant in India with pair-cross technology and twin-stand reversible cold-rolling
mill

The highest productivity steel plant in India, producing 800-plus tonnes per person per
annum

Recognized for its zero-effluent discharge status; it reuses more than 95 per cent of
process waste

Low carbon footprint as it recycles 96% of coke oven gas for power generation

Uses sophisticated ambient air control infrastructure beyond and has reduced gas flaring
to lower levels.

MANAGEMENT EFFICIENCY
The structure of the Board was recently modified in 2007 post the acquisition
of Corus acquisition to suitable incorporate changes which will lead to the

adequate realization of synergies from the deal within the given stipulated
time frame to reap the benefits from the much talked about and criticized
deal.

BOARD
DIRECTORS

OF

14 Board of Directors
8 independent, 6 non
independent
No
of
independent
directors is more than one
third of total number of
directors.

LEGAL ENVIRONMENT
Global operations require compliance with multiple and complex laws and
regulations. In countries where the political systems are still evolving,
frequent changes in economic policy are common, investment guarantees
and property rights are secured, any unforeseen changes can expose the
Groups businesses to uncertainties. The Group operations are primarily in
countries where investment flows are freer and where there are established
political, business and legal frameworks in place. There is an established due
process to independently evaluate country risk exposures for investments in
emerging economies

TATA STEEL PRODUCTS

Financing and Liquidity Strategy of the Tata Steel Group in

response to the global economic crisis.
They have responded by increasing production post commissioning of the
1.8 mtpa programme and focusing on performance improvement to
neutralise the effect of reduced realisations, whereas in South East Asia, the
focus is on working capital management and cost reduction. In Europe we
have cut production by idling blast furnaces at three sites in order to align
production with demand as a part of the Weathering the Storm initiative
which resulted in cash savings of 712 million (US$1.02 billion) in the second
half of the financial year 2008-09. Further, these efforts have been
supplemented by a strategic restructuring initiative launched as Fit for
Future programme which when completed, will result in improvement of the
operating profit of around 200 million annually. In all sites across the Group,
the journey of Continuous Improvement stays on course
Recognizing the uncertain financing environment and the fragile state of the
global banking industry, they focussed on both internal and external levers.
Internally as an organisation, the company placed primary importance on
conserving liquidity through reduced spend management and sharp
reduction in working capital levels. They also focussed on improvement in
the productivity levels and reduction in overheads. On capital expenditure,
they have re-prioritised on the most value creating and critical projects and
reworked the capital planning strategy.
On the external front, the company raised long term capital which acted as
a liquidity buffer in the current circumstance and would be deployed in value
creating long term assets. The above actions ensured that the Tata Steel
Group had adequate liquidity and also financial flexibility for growth and
exigencies. The liquidity position of the Group at the year end was
approximately US$1.9 billion of cash and cash equivalents and undrawn
lines.

THE EIC APPROACH

1.ECONOMY
The steel industry has traditionally been very sensitive to the changing
economic conditions. The recent economic meltdown has created several
challenges which when addressed appropriately, can be countered to
positive eff ect. However, unlike the previous global recessions, this time
around, all the countries have come together and taken action. Additionally,
there has been a tremendous amount of governmental response to the
global depression which is helping to bring about a possible easing of the
situation.
The global downturn also had a major effect on various industries dependant
on steel. Major contraction in the construction projects, automobiles, white
goods demand from the third quarter of 2008-09 resulted in the global
demand for steel dropping by 21% compared to the level consumed in the
same quarter of the previous year.
The demand for steel declined by 26% in the UK and Europe in the third
quarter compared to a year earlier and after a further contraction in the
fourth quarter, demand had fallen by 57% in the UK and 44% in Europe
compared with a year ago. This reflected in a sharp downturn in private
construction projects, as well as large falls in automotive and mechanical
engineering, amplified by severe destocking by both end users and service
centers.
2.INDUSTRY
Some of the major sectors are:

Indian
steel
production has increased by 5 million tones every year. The economic
reforms initiated by the government since 1991 have added new dimensions
to industrial growth in general and steel industry in particular. Steel industry
has been removed from the list of industries reserved for the public sector.
Automatic approval of foreign equity investment up to 100% is now
available. Price and distribution controls have been removed from January
1992, with a view to make the steel industry efficient and competitive.
Company
The year 2008-09 was a historical one epitomised by the acute global
financial imbalance which initially appeared to have spared India only to
impact the markets adversely as the year rolled on. The global economic
slowdown has impacted the steel sector as well. Amidst the turmoil in the
global marketplace, Jamshedpur Works performed remarkably creating many
records on the way.
Indian operations witnessed a less pronounced drop in demand of 11% in the
third quarter, reflecting the reduced activity in infrastructure and commercial
vehicles. Steel is required by various industries as an important raw material
constituent.
Tata Steel has taken aggressive steps to meet the challenges
difficult times through major initiatives in cost reduction,
improvement and production rationalisation. The highest priority
given to expanding steel producing capacity in Jamshedpur, and

of these
process
is being
ensuring

raw material security for the European operations which do not have captive
iron ore and coal resources. The Tata Steel Group has developed a pipeline of
high quality projects, which will be executed, though we will re-phase the
sequence. Projects like the 3 million tone expansion in Jamshedpur, the
proposed steel plant in Orissa and raw material projects in Mozambique,
South Africa and Canada are key drivers of our future value creation.

FinancialAna
lysis

Balance Sheet Analysis

ASSET SIDE
Capital budgeting
The ratio required to calculate
capital budgeting is mainly DebtEquity
ratio.
Tata
steel
has
increasing debts. So the company
has gone in for debt financing and
thus, the company is having a
comparatively higher borrowing
from the market. Basically the DebtEquity ratio has to be as high as
possible so that the company has
lower borrowings and has to pay less interest.
Tata steel has increasing debts. So the company has gone in for debt
financing and thus, the company is having a comparatively higher borrowing
from the market. Basically the Debt-Equity ratio has to be as low as possible
so that the company has lower borrowings and has to pay less interest.
INVESTMENTS
It can be seen that investments in the last year has increased drastically
from negative cash flows to positive cash flows in investment. This was
result of investing subsidiary companies especially Tata Steel Holdings PTE. It

made an investment of about Rs 35,633 crores against Rs 72 lakhs. This has

lead to increase in investments.

Cash management
This requires cash ratio, which
includes cash and cash equivalent /
current liabilities. Over years this
company has managed to keep up
their cash management at par with
other companies. In recent times this
company has raised their cash ratio
as compared to previous years.
Debtors Management
This requires Debtors turnover ratio
which is calculated by, Debtors/Sales.
This ratio has to be as low as possible
so as to gain maximum liquidity for
the company. This means that the
debtors will return money in these
many days.
Tata steel took over Corus in recent
past and had taken a loan for that
purpose and due to this loan their
Debtors turnover ratio just shot up from 29.81 to 33.45.
Inventory Management
We get inventory turnover ratio by,
Cost of Goods Sold/Average or
Current
Period
Inventory.
High
turnover ratio is usually beneficial for
any company as products tend to
deteriorate as they are kept in a
warehouse.
Tata steel has managed to keep their
inventory management very efficient
during these years as we can see
below that it keeps on increasing and

that is what every company needs, a very efficient inventory management

system.

LIABILITIES
1.SHARE CAPITAL
EQUITY CAPITAL

In the current year the company issues equity capital of Rs 4881 cr

as against 1393 crores, this led to the sharp increase in equity capital.
The company has a mix of debt and equity for fund raising. In last four
years company raised money through right s and debentures but this
year they preferred equity capital.
PREFERNCE CAPITAL
In 2007-08 the company issued preference shares of Rs 5472 crores
and issued 60, 00,000 2% Cumulative Convertible Preference Shares.
Also, 2,85,00,000 shares of face value of Rs. 10 per share allotted to
Tata Sons Limited on a preferential basis during the year 2007-08.

 RESERVES AND SURPLUS

There was a steep increase in reserves in 2008-09 due to increase
in foreign currency translation reserve, but in 2008-09, the company
gained Rs 40 crores in foreign exchange fluctuation reserve. On the
other side the company faced losses of Rs 5496 crores as actual loss.

Over the years the company has been increasing its income in share
premium account, through conversion of warrants and preference
shares.
SECURED LOANS
Debentures
Tata Steel placed Non-Convertible Debentures totaling upto Rs. 2,000
crore in May 2008 comprising of 3 series having phased maturities.
The Company further raised a 2-year term loan of Rs. 2,000 crore in
May 2008. In November 2008, the Company raised Rs. 1,250 crore
through Non-Convertible Debentures privately placed with the Life
Insurance Corporation of India, repayable in equal installments at the
end of the 6th, 7th and 8th years.
In April 2009, the Company further raised Rs. 2,000 crore from a term
loan and in May 2009, it privately placed Rs. 2,150 crore of NonConvertible Debentures repayable after 10 years. Thus the Company
raised Rs. 9,400 crore in a year marked by tight liquidity.

One important thing to note is that the interest on debentures

is increasing every year even though the amount of
debentures has reduced considerably.
LOANS and ADVANCES
The debt in the Companys consolidated balance sheet has increased
considerably after the Corus acquisition. The gross debt in the Tata Steel
Group was US$10.54 billion in March 2008 which increased to US$11.78
billion as at the end of March 2009. Tata Steel has about $9 billion of debt in
its books and has to repay $795 million in 2009-10 and $1.3 billion in 201011; however, the company is free from repayment until December 2009. It
has $1.9 billion cash and cash equivalents in its books, and requires $1.2

billion for its capital expenditure during this fiscal.

The increase was primarily on account of raising of new loans to the tune of
US$2.07 billion, during the year in Tata Steel India, to fund growth projects
and to ensure an adequate liquidity buffer in the wake of global liquidity
crisis.
During the year, the company repaid debts to the extent of US$ 1.66 billion
including a prepayment of debt in Tata Steel Europe of around 150 m
(US$215 million). The entire foreign currency term debt in Tata Steel India is
hedged into rupees at acceptable levels. Therefore the company was
unaffected by the volatile movement of the rupee on account of the above
loans.

The gross debt as on March 2009, showed an increase of US$830 million,

which was primarily on account of revaluation, due to currency movements.
Taking into account the liquid equivalents of US$1.9 billion, the net
consolidated debt as at March 31, 2009 was US$9.9 billion.

If the performance of previous years is compared it can be seen that the

loans and advances reduced substantially as the advance against equity was
converted into investments during the financial year and accordingly there
was an increase in the investments.

The
Company entered into a loan agreement with the State Bank of India and
other banks for Rs. 9,500 crores. In January 2008 Rs. 9,000 crores was repaid
with proceeds from the Companys Rights Issue and Rs. 500 crores was
repaid on 28th February, 2008. In November 2007, the Company made a
rights issue offering to shareholders in India, (i) 1 ordinary share for every
five ordinary shares at a price of Rs. 300 per share and (ii) 9 cumulative
compulsorily convertible preference shares (CCPS) for every 10 ordinary
shares at a price of Rs. 100 each.

Unsecured Loans
In the year 2008, Tata Steel raised $500 million equivalent seven-year senior
unsecured bank loan facility in yen to fund production capacity expansion
and also acquisitions.

The Company issued USD 0.875 billion of 1% Foreign Currency Convertible

Alternative Reference Securities (CARS). The CARS accrue interest on the
outstanding principal amount at a rate equal to 1% per annum and are
classified as unsecured debt on the balance sheet of the Company.
During the current fiscal year, the secured and unsecured loans increased by
Rs. 8,924 crore as compared to the balances as on 31st March, 2008 mainly
due to issue of privately placed non-convertible debentures, term loans
taken from Banks and other short term borrowings.
In 2007 the loans increased from Rs 324 crores to Rs 5562 crores due to
new syndicate foreign currency loans drawn for funding the acquisition of
Corus Group plc. The Company has drawn foreign currency syndicate loans
of Rs. 7,225 crores (USD 1.65 billion) during the year as per details given
below:
1. JPY Syndicated External Commercial Borrowings of USD 495 million
equivalent: Rs. 2,162.66 crores (unsecured loan)
2. External Commercial Borrowings of USD 5 million equivalent: Rs. 21.77
crores (unsecured loan)
3. JPY Syndicated External Commercial Borrowings of USD 750 million
equivalent: Rs. 3,298.88 crores (unsecured loan)
4. International Finance Corporation, Washington - A Loan USD 100 million
equivalent: Rs. 435.35 crores (secured loan)

CURRENT LIABILITIES

The current liabilities increased by Rs. 577 crores from a level of Rs. 3,523
crores as on 31st March, 2007 to Rs, 855 crores as on 31st March, 2008. The
increase was mainly due to increase in the value of purchases/services on
account of expansion projects.

I.

PROFIT AND LOSS A/C

Increase in Profit % from 2003 to 2008.

Tata steel showed steady rate in profit.

Its profit increased by 1012.31 to 4687.03 from 2003 to 2008 i.e. by
Rs 3674.72 crores.
From the above table TATA STEEL has given good profits in the year
2004 and 2005.
Due to deal with CORUS and NATSTEEL companys profits declined
sharply but after 2006 the profit rate increased gradually.
Decline in profits in year 2007 to 2008 is because of Recession hit
the market.

Gross Profit
Year

2008-09

2008-07

2007-06

Amount (Rs in
Crs)

9778.51

8830.00

1497.81

The Gross Profit has increased over the period of 3 years however the
change in Gross Profit from 2008-09 and 2007-08 was less as compared to
2006-07 and 2007-08. The Graph shows the increase in Gross Profit 2006-07
to 2008-09.

Profit before Depreciation & Tax

Year
Amount (Rs in
Crs)

2008-09

2008-07

2007-06

8289.01

7900.97

7080.94

The Profit before depreciation and Tax increased at a rate of 11.84% from
2006-07 to 2007-08 and 4.91% from 2007-08 to 2008-09. The fall in the
PBDT was mainly due to the market crunch and global recession which left
its a mark on the companys Financial Statements. However it was
observed that the companys Profits after depreciation and tax followed a
stable increase i.e. an average increase of 11%.
Gross Profit Margin

The GP Margin for 2006-07 was 7.58% followed by 39.79% in 2007-08 and
36.43% in 2008-09.

Depreciation:
Capital Assets whose ownership does not west in the company is depreciated
over the estimated useful; life or five years whichever is less.
In respect of other assets depreciation is provided on a straight line basis
applying the rate specified in Schedule 14 to the Companies Act 1956 or
based on estimated useful life whichever is higher. However, asset value up
to Rs 25000 is fully depreciated in the year of acquisition. The details of
estimated life of each category of assets are as under:
Building 30 60 years.
Plant & Machinery 6 21 years.
Railway Sidings 21 years.
Vehicles and Aircrafts 5 18 years.
Furniture, Fixture & Office Equipments 5 years.
Intangibles (computer software) 5 10 years.
Development of property for development of mines and collieries
are depreciated over the useful life of the mine or lease period
whichever is less, subject to a maximum of 10 years.
Blast furnace relining is depreciated over a period of 10 years
(average expected Life).
Total depreciation for the Financial Year 2006-07 accounted to Rs. 819.29 crs
followed by Rs. 834.61 crs in 2007-08 and Rs. 973.40 crs in 2008-09.

II.

FINANCIAL RISK
TAX AND INTEREST RATE ANYALSIS

From the above balance sheet Interest charged in 2008 is 41,493 (Rs
mn) and in 2009 it decrease to 38,283 (Rs mn) i.e. Change of -8.4%.
Tax charged in 2008 was 40,493 (Rs mn) and in 2009 it decrease to
39,751 (Rs mn) due to decrease in gross profit.
Finance for the Corus acquisition was raised through bridge loans and
later refinanced by Tata Steel which has led to a dramatic increase in
the interest outflow; in the April-June quarter the interest outflow was
Rs241.7 crore compared to Rs41.6 crore for the same quarter last year.

Dividend Policy
Tata Steel has been continuously providing dividend to its shareholders to
maximize its wealth. In the year 2008-09 the company paid a dividend of Rs
1168.95 crores. The payment of dividend is always fixed by the company
irrespective of profits or losses.
Tata Steel is giving a significant higher rate of dividend year after year in
comparison to its nearest competitors.
In 2006-07 the year the company completed 100 years a dividend of 25%
was issued to the shareholders.

Tata Steel was initially giving higher amount of dividend initially on its PAT.
But over a period of time, it decided to change its strategy and putting back
all its earnings on development of the company.

Fund Flow & Cash Flow Statements

Analysis of Funds Flow and Cash Flow Statements

SOURCES OF FUNDS
The profit after taxes has been consistently increasing in the past five
years despite the global crisis and acquisition of Corus in 2007.So the total
PAT available in 2009 is Rs 21091 crores. Since Tata Steel has a lot of fixed
assets in terms of plants and machinery the depreciation is also increasing at
a slower rate, one more reason is that they introduced two blast furnaces in
Jamshedpur this year, which led ot increase In depreciation this year.
In the last 5 years the share capital of the company was very good, but due
to issuing of new shares the share capital is now negative.
Borrowings have been consistent. The way the company managed its
borrowings was amazing. From negative balances, they turned into Rs 5000
crores positive balances; this was as a result of loans taken to finance Corus
deal. Some installments are to be paid after 2011, so there is not too much
burden on Balance Sheet.
APPLICATION OF FUNDS
The capital expenditure was normal in all the years, not much movement
is seen in terms of investment in plant and machinery.
Investments increased significantly. It can be seen that investments in the
last year has increased drastically from negative cash flows to positive cash
flows in investment. This was result of investing subsidiary companies
especially Tata Steel Holdings PTE. It made an investment of about Rs 35,633
crores against Rs 72 lakhs.
The company also announces dividends to the shareholders. Every year it
gives dividends in the range of 100 to 160 %. This year they gave a dividend
of 13 Rs per share, due to which the total outlay was Rs 5632 cr.
The biggest contributor in Utilization of Funds was because of increase in
working capital expenses. In early 2008, the unprecedented increase in the
prices of input costs, particularly raw materials, substantially increased the
working capital requirements. The change in working capital, during the
financial year, was mainly due to increase in inventories on account of
volumes and prices partly offset by an increase in creditors. The working
capital during FY 09 reduced by Rs. 225 crore, mainly due to a reduction in

Inventory (with reduction in finished and semi-finished inventory and

increase in raw materials inventory) and Debtors.

FINANCIAL RATIOS

Ratio Analysis
Operating expenses are expected to increase marginally resulting in increase
of EBITDA margin of 38.7%.But compared to previous year the
EBITDA/Turnover has reduced because the profits were higher than last
years.
ROCE over the years has reduced because of slowdown as well as huge
inventories of stock and new plants introduced in Jamshedpur.
Asset Turnover is very good In last four years the assets were utilized to the
fullest but in the last year due to less demand, it reduced by 1%, but in
overall terms it is optimally used all resources.

Debt Equity Ratio

Tata Steel over the years has been increasing its debt in order to
finance the Corus deal. They took a loan of $ 8 Billion from the bank to
acquire Corus.

Current Ratio

The current ratio is a financial ratio that measures whether or not the
firm has enough resources to pay its debts over the next 12 months. It
compares a firms current assets to its current liabilities. Tata Steel has
a high amount of unutilized current assets. The company has high level
of inventory or WIP. Since the demand for steel has reduced drastically
the company is having huge inventory and because of this the liquid
ratio is low.

Debtors Turnover Ratio

The stakeholders of the company like distributors and suppliers have a

lot of confidence in the company. This shows the creditworthiness and
brand value of the company. Since debtors are paying back in
comparatively less number of days shows faster movement of goods in
the market.
EBITDA/TURNOVER RATIO
The EBITDA for the Group at Rs. 18,495 crores (US$ 3,636 mn) for the
financial year 2008-09 was1% higher than the EBITDA of Rs.18, 287
Crores (US$ 3,595 mn) recorded during the financial year 2007-08.
EPS RATIO
EPS is the reported profit over the number of shareholders in the
company. In the last 5 years EPS has doubled from 31 to 66 and it is
expected to reach 104 in FY10.
P/E RATIO
P/E RATIO IS expected to double in 2010 because of higher profitability
and dividend payouts in the previous years.

Future Prospects
The Company has embarked upon setting up three green field steel plants in
eastern India:
12 MTPA* plant in Jharkhand
6 MTPA plant in Orissa
5 MTPA plant in Chhattisgarh
Jamshedpur Steel Works will become a 10 MTPA unit by 2010.
*MTPA = million tonnes per annum
Solution for Sales (SFS) offers based on the Theory of Constraints (TOC)
concept saw stabilisation in the steel division. The replenishment module
was extended to cover 100% of the retail channel of TATA TISCON, achieved
90% coverage in TATA SHAKTEE and 60% in TATA Steelium. This resulted in a
reduction of stock outs in retail shops and more significantly, a reduction in
channel stocks. Reliability solutions were extended to direct customers in
the Steelium distribution. For the Construction Projects segment, an S-DBR
(Simplified Drum Buff er Rope) mechanism was implemented under the
Theory of strains supply chain improvement initiative which improved the
availability of rebars at the warehouses, thereby reducing instances of
delays and loss of orders.
The term focus is on the implementation of the Fit for Future restructuring
in Europe, to continue with the 3 mtpa expansion project in Jamshedpur and
overseas raw material projects, to increase production volume in India and
optimise working capital management across the Group to preserve liquidity
Looking towards the future, the steel industrys main contribution to the
reduction of CO2 emissions should be to further develop the use of byproducts and to work with its customers to help design well, long lasting,
more energy and material efficient products. Additionally, improvements in
areas other than primary steel production may offer further opportunities for
CO2 reduction.

OBJECTIVES
Every human effort should have pre-determined objective. I
conducted my survey of

Top five brands of Steel with the

following objectives: To know various brands available in the market.

To find out the consumer preference and to extra new insight in to
criteria used and their importance in purpose decision as brand
name/price/outlook/quality.
The main aim of my survey is to find out leading product and market
share of different products of Asian Paints..
The behavior of the product and its cost shall be approachable to
the common people.
A glance at problems faced by dealer along with the commission
margin for them.
To find out the problem and suggestion from the consumer.
To know the nature of the market.
To measure effect of advertisement on sale of product.
Financial analysis of the company.
To know customer expectation from the product.
To understand level of customer satisfaction.

RESEAR
DOLOGY
R ES EAR CH METHO
M ET HODO
LOGY
Introduction
Research Methodology is a way to systematically solve the
research problem. Research in commonplace refers to a search of
knowledge. Research is an original contribution to the existing state of
knowledge making for its advancement. The role of research in several
fields of applied economics whether related to business or economy as
a whole has greatly increased in modern times.
Firstly we should know what is a research methodology. Every
project repeat conducted scientifically had specified framework for
controlling data collection. This framework is collect research design
accurately and economically. There are generally two types of research
design: 1. Exploratory
2. Conclusively Research.
These types of research design used in this project are exploratory.
Exploratory research is that in which new relationship, are
discovered, and looking to the objective of the research that is

finding out the most dominant attribute and also the market leader
in respect to brand vs price.
Data collection Method

Both primary and secondary datas was considered and studied

for the project.

Primary Data

These are the datas which are not readily available to the user or
researcher but these datas has to be collected by some one
primarily for their own use. They are specifically collected for certain
research.
Secondary Data

Refers of those data, which are collected and distributed is parts

and are already available in firm compary internal needs and
commercial trades and private publication.
In the study secondary data were used for required information
like:1. Company profile of top five brands of steel.
2. Getting information about the mode of marketing strategy of
steel product, which attribute population of customer.
Sampling Plan

Sagar has a population of approximately 15 lakhs. For carrying

out any research or study on any subject. It is very difficult to cover
even 10% population. I have for the sample size has to be decibel for a
meaningful conclusion. For designing the sample size, it was thought
proper to cover a very small percentage of population in various age
groups. The method used for sample technique was non-probability
convenience sampling method.
This method was used because it was not known previously as to
whether a particular person will be asked to fill the questionnaire that
were easily accessible and available to the researcher.
Considering the constraints, it was decibel to conduct the study
based on sample size of 20 people in specific age group. Scientific
method was not adopted in this study because of lack of thing, also the
basic aim of doing research was academic; hence most convenient
way was selected.

FINDING
S & CONCLUSION
FINDINGS
As various companies enter into market so it is difficult to make
availability of way brand.
Now a-days customer loyalty has been decreased as some Asian
Paints product is having good quality but high price or vice-versa.
So it is difficult to find locating among customers.
Sagar is small city & there are not many dealers & service
centers of the company.
Mostly middle class people live in sagar so it is difficult to sell
costly Asian paints Products..
As this project is based on A top five brands of steel
information was gathered through simple conversation with the
customers & the dealers. I came to the following conclusion: The interpretation shows that there is no doubt that the purchasing
behaviour revolves around the what, why, when, how questions? As people
differ not only is usual ways but also in their activities preferences and
opinions. However there are some failures succeed in effecting the consumer
behaviour.

LIMITATION
Nothing in this world is perfect. Everything has its limit, so has
this survey. The main limitations encountered are: It is sample survey and sample taken randomly and has
covered limited number of respondent.
It was hard to gather all information about project from
Internet due to some technical problem.
Time is short to carry out the survey is more detail as well as
with more respondent.
Tata steel is more popular in number and same brand of steel
are popular in Sagar City.
The respondent was unwilling towards the questionnaire.
Some time people take it as a fun and do not provide correct
information.
Respondents are unable to understand the questionnaire &
also they are not able to express their view. At most of them
do not understand English language.
Supervision method is time consuming, irregular & expensive.

SUGGESTIONS

Company should be more flexible regarding their marketing

strategies.
Effective

sales

promotion

policies

&

strategies

are

very

important for the increase in the volume of sales & profit.

The company should consider all the four ps i.e. product, price,
promotion and place. These features should be mainly focused
and steps should be taken to improve them.
The quality of the product is equally important, good quality can
force the companys sale but low quality can reduce it to
minimum. It is the basic tool to attract and retain our customers
and make them to satisfied.
The companies should also move according to the latest trends
and should always be ready to introduced innovative features
into their product. The company should implement latest
technological developments into their products.

BOOKS:

MARKETING MANAGEMENT -

V.S. Ramaswamy,
S.Namakumari

RESEARCH METHODOLOGY -

C.R.Kothari

OPERATION RESEARCH -

Vittal

Web Resources:

www.google.com
www.scribd.com
www.tatasteel.com
www.jsw.in

 www. arcelormittal.com