July5 , 2022

n chandrasekaran: Tata Steel to become an intellectual property intensive, non-cyclical materials maker: N Chandrasekaran

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will diversify beyond manufacturing the alloy into three major verticals – composites, graphene, and medical materials and devices, the company’s top management said in its annual report.

“Tata Steel has the objective to build its business in knowledge and intellectual property intensive and non-cyclical new materials,” N Chandrasekaran, the chairman of Tata Steel, said in the annual report.

The steelmaker has already developed a graphene production capacity of 100 tonnes per annum and was investing in the production of medical materials at scale, according to TV Narendran, the CEO and MD of Tata Steel and Koushik Chatterjee, the company’s executive director and CFO. The medical materials segment has a significant market opportunity in India, they said.

The first port of call for the company in the medical material segment will be Hydroxyapatite – a calcium phosphate-based ceramic used in orthopaedic coating on implants, dental implants, bone fillers, cosmetics as well as consumer products.

“We believe that our strengths of strong materials research and development, branding and marketing & sales reach, provide us an opportunity to deliver world-class quality of bio-ceramics through a reliable supply chain to customers at a competitive cost and scale,” the two executives said.

For graphene, the company signed a memorandum of understanding last week with Kerala’s Digital University and Centre for Materials for Electronics Technologies (C-MET) to develop a research centre in the

state.

Speaking about the macroeconomic landscape, Chandrasekaran said that the ongoing geopolitical conflicts, re-imposition of lockdowns in China, global inflation and continuing supply shortages could adversely impact global GDP growth in 2022.

“While there exist risks of high input costs, the growth of the Indian steel industry is likely to remain stable as domestic demand is expected to remain robust and global supply-demand dynamics may present export opportunities,” he said.

After paring over Rs 24,000 crore of consolidated debt in the fiscal year ended March, going forward the 115-years-old company will be playing a balancing game between reducing debt and investing in newer businesses, Narendran and Chatterjee said.

During FY23, the company’s largest capital allocation will be towards the acquisition of Neelachal

Nigam Limited (NINL). Earlier this year, the company won the bid to acquire NINL for Rs 12,100 crore.

“NINL is particularly important given its proximity to Tata Steel’s Kalinganagar site and its potential to become the long products business hub in the future,” they said.

The plant has been non-operational since March 2020. Tata Steel expects to start operations within six months of completing the acquisition and will look to ramp up production to its rated capacity of 1.1 million tonnes per annum within 12 months, they said.



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