Sajjan Jindal-led JSW Steel on Wednesday reported an over two-fold jump in consolidated net profit at Rs 171.25 crore for the quarter ended March 31, mainly due to higher sales.
The company had clocked a net profit of Rs 62.38 crore in the year-ago period, it said in a BSE filing.
Total consolidated income of the firm, however fell by 15 per cent to Rs 10,697.52 crore in January-March quarter of last fiscal against Rs 12,599.70 crore in 2014-15.
The imposition of minimum import price on various steel products during the quarter provided some relief and even though domestic iron ore prices increased, the firm benefited to some extent on account of lower coking coal prices, it said in a statement.
March quarter was marked by the re-commissioning of Blast Furnaces which were under planned shutdown towards relining, modification and capacity expansion at all three upstream steel making locations — Vijayanagar, Dolvi and Salem.
The furnaces at Vijayanagar and Salem works were re-commissioned in February 2016 and the one at Dolvi was re-commissioned only in March 2016.
As a result, the company has been able to record crude steel production for the quarter at 3.21 million tonnes (MT), up 5 per cent year-on-year and 19 per cent quarter-on-quarter. Saleable Steel sales volume stood at 3.28 MT, up 7 per cent on annual basis and 29 per cent on sequential basis.
The installed capacity of the company has increased by about 25 per cent from 14.3 MTPA to 18 MTPA.
For the entire 2015-16 fiscal, JSW Steel reported a consolidated net loss of Rs 741.95 crore. In the preceding fiscal, it recorded a net profit of Rs 1,796.57 crore. Total consolidated income was
lower at Rs 41,878.88 crore from Rs 52,971.51 crore during the period.
For 2015-16, the firm recorded a crude steel production of 12.56 MT, while saleable steel sales volume stood at 12.13 MT.
Reacting to the results, shares of the company rose by 1.45 per cent to settle at Rs 1310.35 apiece on the BSE.
On the outlook, JSW Steel said it expects crude steel output to grow by 25 per cent to 15.75 MT in 2016-17 and saleable steel sales to rise by 24 per cent to 15 MT.
“We expect Indian steel demand to grow by about 6 per cent in 2016-17. Government’s measures to pump prime the economy and progress on various policy reforms underpin a constructive medium term demand outlook,” it said.
However, this also makes India an attractive export destination for steel surplus countries, the firm added.
Indian economy continues to recover gradually as public capex and foreign direct investment continue to improve – infrastructure project awards are seeing a pick up with higher budgetary allocations, it said.
“Expectations of a normal monsoon this year is likely to drive consumer discretionary spending in rural areas,” JSW Steel added.