A sharp decline in net sales realisation (NSR) made the country’s largest steel maker Steel Authority of India Ltd (SAIL) report a 35.25% fall in net profit at R450.91 crore in the first quarter ended June, compared with R696.41 crore posted in the corresponding period a year ago. The NSR declined by 10.9% in the quarter due to subdued market conditions, the company said in a statement.
The NSR reduced to R35,077 a tonne in the quarter, against R39,369 a tonne in the same quarter last year. However, the company produced 6% more saleable steel at 3.2 million tonne during April-June period, SAIL chairman CS Verma said.
The firm reported an increase of 5% in total sales in the quarter at 2.62 million tonne, against 2.49 million tonne in the corresponding quarter of last year. The company’s capital expenditure during the first quarter was R2,082 crore. Under the modernisation and expansion plan, SAIL placed orders worth R58,579 crore and an expenditure of R46,064 crore incurred until till June.
SAIL aims to double its exports in the current fiscal to about 7 lakh tonne. Last year, it exported about 3.3 lakh tonne of steel. “Currently, exports contribute about 3-4 % of our turnover. Last year, export revenues were around R1,200 crore and it should go up to R2,500 crore this year,” Verma said.
The company had debt of R23,300 crore as on June 30. Of this, R11,588 crore is domestic loans, while remaining R11,712 crore has been borrowed in foreign currencies. “All my foreign currency loans are hedged. Else, the losses would have been increased by another R600 crore because of depreciating rupee,” Verma added.