KOLKATA, Aug 10: Facing headwinds amid a slowdown
in the economy, Tata Steel Ltd on Saturday said it is likely
to revise the planned capital expenditure for the 2019-20
fiscal to Rs 8,000 crore from Rs 12,000 crore.
The steel sector is expected to see a pick up in the
second half of the year, a top company official said.
“We have given a guidance that the capex will be 20-25
per cent lower than the original plan between Europe and India
(operations)… our original estimate was Rs 12,000 crore for
the Tata Steel Group… it will now be around Rs 8,000 crore,”
Tata Steel CEO and MD T V Narendran said.
Of the Rs 12,000 crore, the steel major had initially
planned to spend around Rs 8,000 crore on India operations.
“Both sides (India and Europe) will take a cut,”
Narendran told reporters here after the launch of the
company’s steel retail store — ‘steeljunction’.
He said the capex for India will largely be deployed
on its Kalinganagar plant in Odisha.
“We do believe that things should improve in the
second half of the year,” Narendran said.
The top Tata Steel official said in order to insulate
the steel industry from its cyclical nature, the company is
focusing on strengthening the branded consumer business and
downstream product portfolio.
“Today the B2C business is about 15 per cent of our
revenue. We have set a target that the B2C, services and
solutions business should contribute 30 per cent (in the next
five years),” he said.
On the South-East Asia business, he said the company
has signed an MoU with the Synergy Group, which is “interested
in our Thailand assets”.
“We should come to a conclusion in the next two-three
months,” Narendran said.
Following the termination of the definitive agreement
with the HBIS Group to divest 70 per cent stake in its South-
East Asia business, Tata Steel had executed a Memorandum of
Understanding to offload the stake in Tata Steel Thailand to
Synergy Metals and Mining Fund.
“We have a lot of subsidiaries in Europe and many of
them were created over a period of time. At one point of time,
we had 200-300 legal entities and subsidiaries of Tata Steel
Europe.
“We have reduced them significantly and are paring
another 100-120 this year… In India, it is all about
bringing operating subsidiaries together,” Narendran said. (PTI)
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