SAIL Q2 net up 18% at Rs 1.7 k cr

Written by Corporate Bureau | New Delhi, Oct 30 | Updated: Oct 31 2007, 10:01am hrs
The countrys largest steel manufacturer Steel Authority of India Ltd (SAIL) on Tuesday posted 18% rise in its net profit at Rs 1,700.24 crore for the quarter ended September 30, 2007 as compared with Rs 1,442.81 crore during the corresponding quarter last year.

The company also recorded 8.2% growth in its turnover at Rs 10,371.63 crore for the quarter as compared with Rs 9,585.93 crore during the same period last fiscal. SAIL achieved highest-ever first half net profits with a growth of 14% at Rs 3,225.36 crore.

The companys share on the Bombay Stock Exchange (BSE), however, closed down 5.6% at Rs 261.05 on Tuesday.

Attributing the improvement in financial performance to higher production of saleable steel, including value added products, chairman SAIL S K Roongta said, Record capacity utilisation of 117% in the second quarter augurs well for strengthening the current performance.

The board of directors has approved Rs 15,000 crore investment for modernisation and expansion of IISCO steel plant and Salem steel plant. Besides installing a slag-based cement plant at Bhilai, the board has also accorded approval for a slag-based plant at Bokaro through a joint venture.

The company benefited, as the prices of coking coal (on a long-term basis) were lower during this quarter as compared to the same quarter last fiscal. The firm reduced its energy consumption by 1% during the quarter. Rupee appreciation also favoured the company, as it spends significant amount in importing the raw material.

SAILs thrust on value added products resulted in the production growth of electrode quality wire rods (53%), high corrosion-resistant TMT bars for coastal areas (664%), LPG grade steel (38%), rails (115), and tin plate (59%) duringthe quarter.