Tata Steel Q3 Profit Soars 723% to Rs 2,689 Crore in FY26

Tata Steel Limited announced a significant surge in its financial performance for the third quarter of the fiscal year 2026. On February 6, the steel major reported a consolidated net profit of Rs 2,689 crore for the quarter ending December 31, 2025. This represents a staggering 723% increase compared to the Rs 327 crore profit recorded in the same period of the previous fiscal year.

Detailed Financial Performance

The company's revenue from operations for Q3 FY26 stood at Rs 57,002 crore, marking a 6% increase from the Rs 53,648 crore posted in the corresponding quarter last year. This growth highlights a resilient demand environment, particularly within its domestic market. However, on a sequential basis, the performance showed some moderation. The net profit saw a 13% decline from the Rs 3,102 crore reported in the second quarter of FY26, while revenue dipped by 3% from Rs 58,689 crore in the same period.

Operational efficiency also saw a marked improvement. The company's consolidated EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization), adjusted for forex movements, was Rs 8,276 crore, a notable rise from the Rs 7,155 crore in the prior year. This improvement was reflected in the margins, with the net profit margin expanding to 4.79% from just 0.55% in Q3 FY25, and the operating EBITDA margin climbing to 14.58%.

India Operations Drive Growth

The primary engine for this impressive performance was Tata Steel's India business. Production and deliveries from Indian operations grew by 12% and 14% year-on-year, respectively. The company achieved a milestone, with quarterly deliveries crossing the 6 million tonne mark for the first time, reaching 6.04 million tonnes. T.V. Narendran, CEO and MD of Tata Steel, noted the strong momentum, stating, “We continued to strengthen our market leadership across chosen segments, supported by capacity expansion and a focused downstream strategy. Automotive volumes grew 20% YoY, while our retail vertical gained further momentum.”

European Business Faces Headwinds

In contrast to the robust domestic performance, the company's European operations in the UK and the Netherlands faced challenges due to subdued demand. Deliveries from these regions were lower on a sequential basis. For the quarter, Tata Steel Netherlands reported revenues of €1.35 billion and an EBITDA of €55 million. The UK operations, however, recorded revenues of £468 million and an EBITDA loss of £63 million. The UK business is currently undergoing a significant restructuring, transitioning from blast furnaces to a more environmentally friendly electric arc furnace-based steelmaking process, which is expected to be completed over the next two years.

Cost Management and Debt Reduction

A key contributor to the improved profitability was the company's rigorous cost optimisation program. Koushik Chatterjee, Executive Director and CFO, highlighted the success of this initiative. “Our cost transformation program, focused on multiple levers including operating KPIs, supply chain efficiencies and procurement, has delivered savings of around Rs 3,000 crore for the quarter and around Rs 8,600 crore for the first nine months of the financial year,” he said. This financial discipline also led to a reduction in consolidated net debt, which stood at Rs 81,834 crore at the end of the December quarter.

Market Reaction

The financial results were declared after market hours on February 6, 2026. Ahead of the announcement, shares of Tata Steel had shown some weakness. The stock closed 0.6% lower on the National Stock Exchange at Rs 196.51 per share for the day.

Conclusion

Tata Steel's third-quarter results for FY26 paint a picture of a company successfully leveraging its domestic strengths to offset international challenges. The record-breaking performance of its India operations, combined with stringent cost controls, has delivered a remarkable bottom-line expansion. While the European business navigates a difficult market and a major operational transition, the company's focus remains on strengthening its Indian market leadership and maintaining financial discipline to create long-term value for its stakeholders.