JSW Steel reported its highest-ever consolidated quarterly net profit of ₹1,109 crore in the June quarter against ₹21 crore on the back of higher realisation and lower costs.
Net sales were up two per cent at ₹12,720 crore (₹12,447 crore). Overall cost of production was down 11 per cent at ₹10,448 crore (₹11,773 crore).
Seshagiri Rao MVS, Joint Managing Director, JSW Steel, said the company has managed to bring down the inventory built up in March quarter in anticipation on planned shut down at Dolvi and Vijayanagar to ramp up capacity.
Overall earnings were also boosted by the focus on cost reduction and volume growth.
The company also recorded its highest-ever sales volume and production of 3.34 million tonnes (3.11 mt) and 3.87 mt (3.40 mt) thanks to the fresh capacity added at Vijayanagar and Dolvi, he added.
JSW’s earnings before interest, tax, depreciation and amortisation was ₹9,277 a tonne, up from ₹5,398 in the same period last year.
On the possibility of continuation of the Minimum Import Price, Rao said the uncertainty in global market was aggravated by the UK decision to exit Europe and China looking at every opportunity to increase production capacity and dumping it on other countries.
China’s export during the June quarter has gone up to 133 mt (101 mt) and its capacity utilisation was up at 75 per cent against 65 per cent in the same period last year despite talks of their economic slowdown, he said.
Though imports into India fell 26 per cent in June quarter about 50 per cent of imports came in below MIP. There has been clear violation of import restrictions. The government should not only continue with MIP but also cover more items to check circumvention of import restrictions, he said.
Rao said international steel prices have come down, dragging prices in India along in June and July. The company expects steel prices to be under pressure with fresh capacity going on stream and demand remaining weak.
The company plans to participate in category ‘C’ iron mines put on auction by Karnataka government and expects the entire process to complete by September.