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Informist, Friday, Jul. 3, 2026

 

By Astha Oriel

 

NEW DELHI – Shareholders of Tata Steel Ltd. expressed doubts about the financial viability of the company's international operations in Europe, even as the management remained upbeat at the 119th annual general meeting Thursday. Of the 50 shareholders who attended the meeting virtually, more than 15 sought clarity and raised concerns about the company's operations at the Port Talbot plant in the UK and the IJmuiden plant in Netherlands.

 

The shareholders mainly sought clarity from the management on the company's growing losses in the UK and Netherlands despite huge investments, the 1.4 billion-euro class action lawsuit by Dutch non-profit organisation Stichting Frisse Wind.nu alleging harmful emissions from the IJmuiden plant, and the recent letter sent by local authorities in Netherlands to Tata Steel Netherlands triggering early closure of its coke and gas plants. One shareholder said the company should fix an "end date" for the losses at the IJmuiden plant, acquired from the Corus Group in 2007. "European losses are putting a brake on dividend payments to Indian shareholders," the shareholder said. "It is indirectly transferring Indian wealth to these European companies. I don't know how many billions have been transferred to European operations in the last 19 years."

 

Another shareholder pointed out that the company is "bleeding" money in the UK and Netherlands. "How much are we getting from UK and Netherlands? When are we going to get those dividends from the UK and Netherlands? What is the status of that? ... When will the Europe business profitability become positive? ... And the operations in Canada for minerals, what is the status of that?" the shareholder asked.

 

The shareholders also sought clarity on the implications of the letter from the Dutch environmental agency and a local province for the company's coke and gas plants in Netherlands. In April, the agencies had informed Tata Steel Netherlands of their intention to revoke the company's operating permits and trigger early closure of the coke and gas plants. In the March quarter post-earnings call with analysts, the management had said it is considering options to source raw materials from various sources, including India, if coke ovens in Netherlands shut down before the planned electric arc furnace starts.

 

Another shareholder, while noting that the turnaround of European operations is progressing well, sought clarity on the sustainable profitability of the European business and the challenges related to it.

 

For the UK operations, the shareholders' queries focused largely on the completion of the 1.25 billion-pound-sterling electric arc furnace project at Port Talbot and the delay by the British national grid to supply power at the Port Talbot plant. "The company is executing near about 1.25 billion-pound EAF (electric arc furnace) project at Port of Talbot, considering structural asset transformation typically stand near some returns. What is the expected timeline for this project to transition from a capital drain phase to a positive ROCE (return on capital employed) driver?" one shareholder asked.

 

The shareholders' queries come at a time when Tata Steel is facing operational challenges in Europe. At the annual general meeting, Chairman N. Chandrasekaran flagged the challenges regarding operations in Netherlands due to tighter emission levels. "Emission norms have tightened to levels where, for some of Tata Steel Netherlands' legacy assets, viable solutions are not currently feasible within regulatory accepted timelines," he said.

 

Responding to shareholders' queries on the Netherlands operations, the chairman said the earnings before interest, tax, depreciation, and amortisation from the Netherlands business is expected to reach 400-500 million euros in the financial year 2026-27 (Apr-Mar). "Since the acquisition, we have not funded Netherlands (Tata Steel Netherlands). So, all their operations are being funded by the cash they generate and they have paid about a billion euros of dividend for all these years," Chandrasekaran said.

 

For the UK operations, he admitted that the delay by the national grid is causing the company "anxiety". "Overall, that is why the project instead of FY28 may shift to FY29," he said. "But any increase in cost, we are in discussion with the government." In the March quarter analyst call, the company had said it expects the UK operations to be EBITDA-positive in FY27.

 

In their notes after the March quarter earnings, brokerages had pointed out that the possibility of early closure of the coke and gas units of Tata Steel Netherlands was likely to affect the profitability of Tata Steel's European operations in the quarters to follow. Analysts also noted that a delay in restarting Tata Steel's electric arc furnace facility at Port Talbot and the temporary closure of the direct sheet plant at IJmuiden may also affect the European operations. 

 

For the March quarter, Tata Steel had reported a consolidated net profit of INR 29.26 billion on revenue of INR 632.70 billion. Friday, its shares closed at INR 189.80 on the National Stock Exchange, up a little over 1% from Thursday.  End

 

Edited by Rajeev Pai

 

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