Tata Steel plans to invest $2.5 billion (about ₹21,411 crore) through its fully-owned Singaporean subsidiary T Steel Holdings this fiscal year to strengthen European operations while reducing debt from UK and Netherlands mills. The board authorized the cash injection which surpasses RBI’s $1 billion overseas threshold so it requires regulatory approval. The holding company owns 100 percent of its operations so equity dilution will not occur. The Indian group expanded its FY 25 initiative by converting $565 million in inter-company loans into equity which enhanced the offshore arm’s balance-sheet strength at the time steel demand started rising in Europe.
The European push for heavy industry decarbonization will be supported by this funding which enables the closure of outdated blast furnaces and deployment of electric arc furnaces that reduce emissions and operating expenses. The future profitability depends on three factors: the Carbon Border Adjustment rules, the supply and pricing of low-carbon raw materials and the willingness of customers to purchase green steel at a higher price. The enhanced capital structure according to Tata Steel enables the company to handle market uncertainties while defending its European operations and seizing sustainable steel market opportunities. Investors will monitor regulatory approvals together with European market demand indicators to determine the long-term success of this plan.
