Steel cos may register good show in Q1

Banking upon the high prices prevalent before mid-June, steel companies are likely to record a good earning for the first quarter of the current fiscal.

?Overall growth both in terms of sales and profits will be good. Tata Steel will be the real star performer yet again? said Amitabh Chakraborty, president (equity) of Religare Securities.

As per Religare Securities projection, Tata Steel, the biggest steel producer in the country, is likely to register a turnover of Rs 4,030 crore during the first quarter, which is up 16% from the corresponding quarter last fiscal. The profits of Tata Steel is expected to touch Rs 1,050 crore showing a growth of 15% year-on-year (YoY).

?We are equally bullish on Tata?s Corus as steel prices have remained quiet high in Europe? Mr Chakraborty added . Tata group too expects to touch $50-billion turnover mark by the end of current financial year. At present, the turnover of the steel giant is $22 billion and which is expected to be $28 billion by the end of the current fiscal. Corus is likely to bring in an additional turnover of $22 billion, making it $50 billion.

The Steel Authority of India (SAIL), the largest steel producer in the country, too is unlikely to disappoint the market. Its sales for the first quarter is expected to be Rs 6,930 crore , while its profit for the first quarter is expected at Rs 1,122 crore, showing a 11% increase compared to the same period in the last fiscal.

However, Mr Chakraborty, says that realisation of both these companies has not been very good because of rupee appreciation. In absence of rupee surge, permorfance of both these companies would have spectacular, he added.

The other steel companies such as JSW and JSPL are also likely to record a impressive performance for the first quarter. JSW is expected to have a sale of Rs 2,300 crore, up 100% from the corresponding period last fiscal. Profits are expected at Rs 350 crore, up 50% year-on-year.

JSPL is expected to report overall turnover of Rs 1,300 crore for the first quarter which is up 90% as compared to same period last fiscal. Company is likely to report a profit of Rs 240 crore for the first quarter current fiscal, up 55% from corresponding period last fiscal.