Tata Steels June quarter profits, with Corus, at Rs 3,914 crore

Written by Corporate Bureau | Mumbai, Aug 28 | Updated: Aug 29 2008, 05:51am hrs
Tata Steels consolidated net profit, including earnings of Corus, rose 62.49% to Rs 3,914.62 crore in the quarter ended June 30. The consolidated total income rose 39.18% to Rs 43,560.90 crore in the June quarter, from Rs 31,296.3 crore in the corresponding period previous fiscal. On July 31, the company had announced a net profit of Rs 1,488.40 crore for the quarter under review but that did not reflect results of its UK operations- Anglo-Dutch steel maker Corus, which it acquired last year. Shares of Tata Steel closed at Rs 571.80, down 1.65% on the BSE.

However, the company is cautious as the raising material costs will have an adverse impact over the companys margins in the future. Tata Group chairman, Ratan Tata in Tata Steels 101st AGM that held in Mumbai on Thursday, said, The global steel industry has faced pressure on their margins, arising from an increase in iron ore and coking coal costs, but for the most part this increase was absorbed by the market through the steel price increase. The full impact of this cost increase on steel producers and the consequential higher steel prices to user industries will, however, only be felt in the current year, at which time, one might expect some slowdown in economic activity and consumer demand.

Global steelmakers including ArcelorMittal, Corus and Posco raised prices this year to pass on a threefold surge in coking coal rates and a near-doubling of iron-ore costs. Tata Steel, which has held prices in India following a government diktat, faces the challenge of battling record coal and iron-ore prices, he said. The company is looking at forming iron-ore and coal ventures in Mozambique and is scouting for limestone ventures in Oman, Tata added.

While responding to shareholders query on environmental issues over Dhamra port project, Ratan Tata said that Greenpeace, the NGO which protests against it could not provide any evidence to substantiate their claims. Also he agreed to meet the protestors on September 10 at Bombay House. Greenpeace has been protesting against Tata Steels JV with L&T to develop Dhamra port on the Orissa coast, alleging that it will affect breeding of Olive Ridley turtles and the coastal environment.

Income from the companys UK operations and subsidiaries constitutes 74% of the consolidated total income, Tata Steel said in a filing to the Bombay Stock Exchange.

For the quarter ended June 30, Tata Steel reported a 60.43% growth in profit after minority interest and share of profit of associates at Rs 3,900.90 crore, against Rs 2,431.50 crore.