XTRAS: In September 2021, Tata Steel became the first global steel manufacturer to join the Sea Cargo Charter (SCC) in an initiative to reduce ‘Scope 3’ greenhouse gas emissions in ocean trade.

SWOT ANALYSIS

Strengths
• Integrated operations in India: The entire process of extraction from mines and ores to producing finished steel material is integrated in India.
• Market Position: Tata Steel is world’s second-most geographically-diversified steel producer. It has a strong presence in Asia-pacific and Europe.
• Diverse Product Portfolio, Trust of TATA, Global footprint, & Capability & Adaptability.
Weakness
• Over-Dependence on Europe even though it’s an Indian brand, over 50 per cent of Tata Steel’s business comes from Europe and thus any economic slowdown within Europe affects Tata Steel’s revenues.
• Functional Issues: Operational efficiency is not as good as international leaders.
• Slightly lagging on the technological front.
Opportunity
• Tata Steel lags behind its competitors within the technology front and has a chance to adopt newer technologies and Public-private partnership.
• The steel market in India is predicted to grow within the next 4 years.
• Growth in the manufacturing, construction and automotive industry within the future will drive the expansion within the industry and Tata Steel is set to benefit from it.
Threats
• Intense competition by JSTW Steel, Essar Steel, and Arcelor Mittal, etc.
• Increases compliance costs due to stringent governmental and environmental regulations.
• Decreasing global steel prices as Excess production in China.
• Miscellaneous issues: India is plagued with violent agitation against land acquisition.

Future Prospects

• Most of the large infrastructure projects have halted across the world along with retail consumption declining especially in the housing sector due to Covid-19. The impact is expected to be in double digits for the company in the coming years.
• TATA Steel is looking forward to trimming costs in its European business lines and thereby improving profitability.
• India’s apparent steel use per capita stood at 70 kg in 2018, which is only one-third of the world average. This indicates that India has a huge potential for steel demand growth.
• Opportunities arising from the changing technological landscape.