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Comparative Financial Analysis of Tata Steel and SAIL: A Sectoral Perspective

Authors:

By Kriti Sethiya

Student at Amity Business School,

Amity University Chhattisgarh

Abstract: In the present economic system, financial markets are crucial because they route savings to useful investments, offer liquidity and ensure transparent price discovery for many financial assets. Together, equities, fixed income, foreign exchange, commodities and derivatives determine how capital is used which helps decide the course of growth in different economies. In such a broad setting, studying corporate finances carefully gives helpful information on a company’s strength and about trends in its sector.

This report is meaningful because it stands at the link between theory and action, as shown by the main comparison of Tata Steel Limited and Steel Authority of India Limited. Carried out during my research , the analysis combines liquidity, profitability, solvency and efficiency in analysis. Most of our analyses are based on balance sheets, income statements and extra financial journals covering the past five years, allowing us to do horizontal comparisons, vertical assessment and ratio analysis.

Financial ratios such as current ratio, quick ratio, debt-to-equity, interest-coverage, net profit margin, return on equity, asset-turnover and earnings per share are employed in the report, along with trend assessment and common-size analysis. Making use of corporate governance, planned investments and economic changes helps to explain and balance the results obtained by calculations.

As a result, the analysis clearly demonstrates that Tata Steel’s cash reserves and income from all over the globe are stronger, while SAIL, having higher debt, has also tried to grow by expanding its factories mainly with government support. Thanks to these ideas, different stakeholders such as corporate managers and government officials, have guidance on how to use funds, assess risks and plan industrial policies. It tries to connect ideas from theory with facts gathered from research, to help stakeholders gain insights on how the leading steel producers in India interact within the financial sector.