The sluggish global demand for steel, overcapacity in the Indian steel industry, coupled with global price lows were reasons stated for drop in profit even as the production was up by 5 per cent.
Revenue from steel during the quarter stood at Rs 1,990.69 crore, while the balance Rs 258 crore came from other businesses.
Tisco recorded a drop of 62.97 per cent in net profit to Rs 204.90 crore for the year ended March 31, 2002 as against Rs 553.44 crore in the fiscal ended March 31, 2001. Net profit of the company after debenture redemption, capital redemption and other appropriations is at Rs 215.82 crore as against Rs 214.76 crore in the previous fiscal.
Turnover for the fiscal ended March 31, 2002 has decreased by 1.95 per cent to Rs 7,607.48 crore from Rs 7,759.44 in the corresponding fiscal ended 2001. Operating profit was lower at Rs 1,271.18 crore for the last fiscal as against Rs 1,706.53 crore previous fiscal.
The company said in view of the interim dividend of 40 per cent declared in May 2002, for the last fiscal, it has decided not to recommend any final dividend. The company redeemed 8.42 per cent (1,40,00,000 shares) cumulative redeemable preference shares at a face value of Rs 100 a share. Shares were redeemed at an aggregate of Rs 140 crore.
Managing director B Muthuraman stated, while announcing Tiscos results here on Thursday, we are winning in a downturn. The companys sales were higher in the last fiscal, with Tisco achieving a higher overall market share in the domestic market.
Mr Muthuraman said the steel industry as a whole was extremely fragmented. There was an ongoing consolidation of the steel industry globally, yet there were no signs of such a consolidation in India. Growth rate in the domestic market estimated at 4-6 per cent was not positive, he said.
Naming China Steel and Posco as two of the three steel companies which had managed to perform well over the past year globally, Mr Muthuraman said Tisco is among them. With global steel prices falling at an aggregate of 7 per cent per annum, he said Tiscos position as the lowest cost steel producer had aided in the companys positioning in the market.