New Delhi [India], June 28 (ANI) Global financial services and rating firm Moody's Investors Service has changed the outlook on steelmaker Tata Steel to positive from stable.

Tata Steel is a leading steel producer with manufacturing facilities in India, the UK, the Netherlands, and Southeast Asia.

The company generated consolidated revenues of $32.8 billion during the financial year that ended in March 2022.

"Today's outlook change to positive reflects Tata Steel's track record of delivering a solid operating performance while maintaining conservative financial policies; and the likelihood that upward rating pressure will build over the next 12 months if recent performance and credit metrics improvements are sustained," said Kaustubh Chaubal, a Senior Vice President of the firm.

The steel company is poised to reduce its debt by at least $1.0 billion in the current financial year 2022-23, Moody's said in a statement.

The structural improvement in Tata Steel's capital structure during the last two financial years has created a lasting buffer to the company's key credit metrics and liquidity, thus reducing the company's overall credit risk.

"Tata Steel's well-laid-out capital allocation policy that prioritizes debt reduction over capital expenditure and new investments underscores our positive outlook. The substantial debt reduction achieved over the last two years, as well as the reduction to come over the remainder of fiscal 2023, will greatly improve the company's financial flexibility and resilience and position it for an investment-grade rating," Chaubal added in the statement.

On steel prices, it said that rising global interest rates to curb rising inflation and an increase in export taxes of steel in India have somewhat dampened its prices.

Tata Steel's liquidity position is "good", it added.

The company's $3.1 billion in cash and liquid investments at the end of March 2022 and estimated $6.5 billion-$7.0 billion in operating cash flow over the next 18 months till September 2023 should be more than sufficient to meet its $9.0 billion in capital expenditure, announced acquisitions, modest dividends, and its scheduled debt repayments over the same period, Moody's said. (ANI)