The Ductile Iron (DI) Pipe Plant-2 (new plant) production had a vertical ramp-up and its production of Finished Pipes touched 35 kt in the quarter (25 kt in Q3 FY’23). Company’s product portfolio now covers the larger size range of 900 to 1200 mm diameter pipes which constituted almost 30% of sales from the new plant.

Revenue for the quarter saw an increase of ~17% Q-o-Q caused mainly by higher deliveries of DI Pipe by ~33% and higher realization of both Pig Iron and DI Pipe by ~2% and 8% respectively. Delivery of DI Pipe was also higher by ~50% compared to the last quarter of FY’22 and 25% Y-o-Y with higher volumes available from new plant.

Some highlights for the year’s performance are:

• Hot Metal production at 562 kt
• Highest yearly DI Pipe production of 300 kt (previous high 236 kt in FY’22)
• Highest yearly DI Pipe despatch of 296 kt (previous high 237 kt in FY’22)
• Highest yearly Coke production of 236 kt (previous high 232 kt in FY’22)
• Highest yearly Power generation of 24 MW (previous high 22 MW in FY’22)

Alok Krishna, Managing Director of Tata Metaliks said: “Pig Iron business was adversely affected by weak market sentiments of commodity prices. Domestic demand of Pig Iron is expected to firm up in the coming quarters as utilization levels in several segments like General Castings and Agriculture are likely to improve. Imported coal price is expected to remain range bound as indicated by trend of Coal futures.

The Company’s DI Pipe business has a healthy order book for FY’24 execution because of robust demand for Government’s water infrastructure projects. The Company is geared up and well positioned to meet this high demand in the upcoming quarters through additional volumes from the new DI Pipe plant. The new DI Pipe plant has been ramping up well with volumes increasing Q-o-Q.” 

Tata Metaliks Limited is a subsidiary of Tata Steel which started its commercial production in 1994. It has its manufacturing facilities at Kharagpur, West Bengal, India which produces Pig Iron and Ductile Iron pipes. The plant annually produces around 600,000 tonnes of hot metal, out of which over 350,000 tonnes is converted into DI Pipes and the rest into Pig Iron.

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After a weak performance in Q1, there has been a significant improvement in all round operational performance including much higher deliveries. Revenue for the quarter saw an increase of ~32% Q-o-Q while the increase was 36% over Q2 FY’22. This was driven by higher sales volume of both Pig Iron (PI) and Ductile Iron (DI) Pipe by ~23% and ~52% respectively despite the disruption for 4-5 days due to rail & road agitation in Kharagpur.

Tata Metaliks reports Q2 earnings:

▶Net profit down 73.9% at Rs 14.3 crVsRs 54.8 cr (YoY)

▶Revenue up 36% at Rs 877 crVsRs 644.8 cr (YoY)

▶EBITDA down 59% at Rs 40.9 crVsRs 99.8 cr (YoY)

▶Margin at 4.7% Vs 15.5% (YoY)

• Stable and improved plant performance resulting in higher hot metal production q-o-q by ~25%. DI Pipe production also increased q-o-q by ~40% as additional volumes became available with the ramping up of the new DI Pipe plant that was formally inaugurated by the Hon’ble Chief Minister of West Bengal in Sep’22.
• Realisation of PI saw a q-o-q drop of ~11% due to oversupply in domestic market as a result of virtual stoppage of exports post imposition of export duty on PI @ 15% from May-22. Realisation of DI Pipe, on the other hand, increased by ~3% compared to Q1.

 “The Company has been able to bounce back after a weak performance in Q1, with both PI and DIP business delivering much higher volumes than Q1. The new DI Pipe plant has been ramping up well and higher volumes are expected to come from it in Q3. Pig Iron market demand is expected to continue to be under pressure due to oversupply in domestic market although post festive season, demand and utilization levels are expected to be better from Nov’22. Coal price (FOB Australia) is likely to remain range bound with possibility of marginal uptick in Q3 as indicated by trend of Coal futures. The demand outlook for DI Pipes for H2 is robust in line with the Govt’s increased outlay through JalJeevan Mission for providing drinking water to the population. H2 istraditionally a much better period for DI pipe with demand picking up and will be supported by additional volumes from the new DI Pipe plant.”

Sandeep Kumar, Managing Director, Tata Metaliks

Tata Metaliks Limited is a subsidiary of Tata Steel which started its commercial production in 1994. It has its manufacturing facilities at Kharagpur, West Bengal, India which produces Pig Iron and Ductile Iron pipes. The plant annually produces around 600,000 tonnes of hot metal, out of which over 200,000 tonnes is converted into DI Pipes and the rest into Pig Iron

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