The Telegraph reported that Tata Steel Ltd has decided to extend INR 800 crore worth of financial support to Kolkata headquartered Tata Metaliks to help its subsidiary efficiently manage working capital requirements amidst heightened volatility in the steel market. The assistance will be provided in the form of INR 200 crore inter-corporate deposits of revolving nature and an option to dip into the nonfund based facilities of the parent up to INR 600 crore. The financial assistance will be only for the fiscal year of 2022-23 and fall under related party transactions. Consequently, Tata Metaliks has sought approval from the shareholders for the proposed transaction. Tata Metaliks said “Steel sector is going through frequent volatile cycles. The volatile commodity price environment is driven by the Russia Ukraine conflict, associated sanctions and consequent supply chain disruptions. Volatile prices of commodities require a significant amount of working capital for the company. The financial assistance will help the group ecosystem in ensuring secured and efficient utilisation of cash management and will bring synergy across companies by sharing the pool of resources as it will ensure consistent utilisation of capital at arm’s length.” Tata Steel is the holding company of Tata Metaliks having 60.03% stake. The development comes weeks after the city-based company completed the expansion of the DI pipe-making facility at an investment of INR 600 crore.
The Telegraph reported that Tata Steel Ltd has decided to extend INR 800 crore worth of financial support to Kolkata headquartered Tata Metaliks to help its subsidiary efficiently manage working capital requirements amidst heightened volatility in the steel market. The assistance will be provided in the form of INR 200 crore inter-corporate deposits of revolving nature and an option to dip into the nonfund based facilities of the parent up to INR 600 crore. The financial assistance will be only for the fiscal year of 2022-23 and fall under related party transactions. Consequently, Tata Metaliks has sought approval from the shareholders for the proposed transaction. Tata Metaliks said “Steel sector is going through frequent volatile cycles. The volatile commodity price environment is driven by the Russia Ukraine conflict, associated sanctions and consequent supply chain disruptions. Volatile prices of commodities require a significant amount of working capital for the company. The financial assistance will help the group ecosystem in ensuring secured and efficient utilisation of cash management and will bring synergy across companies by sharing the pool of resources as it will ensure consistent utilisation of capital at arm’s length.” Tata Steel is the holding company of Tata Metaliks having 60.03% stake. The development comes weeks after the city-based company completed the expansion of the DI pipe-making facility at an investment of INR 600 crore.
