Financial & Manegerial Analysis of Tata Steel

Topics: Balance sheet, Generally Accepted Accounting Principles, Asset Pages: 11 (3698 words) Published: September 8, 2011
Managerial Accounting|
Analysis of Balance sheet and P&L account of Tata Steel| |

Miss Razia Sehdev
By,Harprit Singh


Industry Profile _______________________________________________ 03 Comparative Analysis __________________________________________ 04 Trend Analysis _______________________________________________ 05 - 07 Common size statement _________________________________________ 08 Financial Ratio & Some extra graphs ______________________________ 09 – 12 Annexure _____________________________________________________ 13 – 21

Tata Steel

“Tata Steel, formerly known as TISCO and Tata Iron and Steel Company Limited, is the world's seventh largest steel company, with an annual crude steel capacity of 31 million tonnes. It is the largest private sector steel company in India in terms of domestic production. Currently ranked 410th on Fortune Global 500, it is based in Jamshedpur, Jharkhand, India. It is part of Tata Group of companies. Tata Steel is also India's second-largest and second-most profitable company in private sector with consolidated revenues of 132,110 core (US$29.46 billion) and net profit of over 12,350 core (US$2.75 billion) during the year ended March 31, 2008. Tata Steel is the 8th most valuable brand according to an annual survey conducted by Brand Finance and The Economic Times in 2010. Its main plant is located in Jamshedpur, Jharkhand, with its recent acquisitions, the company has become a multinational with operations in various countries. The Jamshedpur plant contains the DCS supplied by Honeywell. The registered office of Tata Steel is in Mumbai. The company was also recognized as the world's best steel producer by World Steel Dynamics in 2005. The company is listed on Bombay Stock Exchange and National Stock Exchange of India, and employs about 82,700 people (as of 2007)..Tata Steel came into limelight on August16,2007 when it successfully won the bid for British steel maker Corus. It was, to date, India's largest ever foreign takeover. It made the Tata Group the world's fifth largest steel maker, and catapulted them to the global league.” Comparative analysis

“The item-by-item comparison of two or more comparable alternatives, processes, products, qualifications, sets of data, systems, or the like. In accounting, for example, changes in a financial statement's items over several accounting periods may be presented together to detect the emerging trends in the company's operations and results. See also comparability analysis.” Shared Capital Comparison

There is sudden rise in shared capital is showing that they have increased their customer base to a large extent.

They have taken a huge loan in 2007 and this shows that their liquidity position is weak. Trend Analysis
“The term "trend analysis" refers to the concept of collecting information and attempting to spot a pattern, or trend, in the information. In some fields of study, the term "trend analysis" has more formally-defined meanings.” Although trend analysis is often used to predict future events, it could be used to estimate uncertain events in the past, such as how many ancient kings probably ruled between two dates, based on data such as the average years which other known kings reigned. Trend Analysis of Tata Steel

In this graph we can see that the Share capital has drastically increased in 2006 to 2007 because Tata Steel has acquired Corus and this has given a very big base in UK. We can see that secured loan has not increased much but the debt has been taken a lot from other financial sectors to increase their current asset which may help them to buy Corus Steel. Secured loans has not increased because this money was invested in buying Corus. The position of company is declining in every case from 2007 to 2008.

Here we can see that the Reserve total of Tata Steel has a great trend from 2006 to 2007 and again declined in...
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