Steel Authority of India Ltd has slipped to a net loss of ₹321.64 crore during the first quarter of fiscal 2015-16.
In the same quarter last year, the company had a net profit of ₹529.88 crore.
The company has suffered a net loss during the quarter primarily because of 15.3 per cent year-on-year drop in net sales realisations, it said.
During the quarter, the company's net income dropped 16.2 per cent to ₹9,502.8 crore from ₹11,341.2 crore in the same quarter last year.
While SAIL suffered from lower net sales realisation, it also saw a higher outgo on raw materials, including the increased royalty on iron ore, which has been effective since September 2014. The company has also seen an increase in the power purchase costs.
“Though domestic steel consumption witnessed a growth of about 7 per cent in the first quarter of fiscal 2015-16, the country witnessed an unprecedented increase in imports from countries like China, Japan, Korea, Russia and others and this eroded a large market chunk of the domestically produced steel,” SAIL said in a statement.
Giving its outlook the company supported the upward revision in import duty on steel products.
“The company is following a strategy where in addition to increasing volumes and focussed cost reduction, the thrust will be on maximising production of value added products to get the benefit of increased infrastructure spending in the near future,” said Rakesh Singh, Secretary, Ministry of Steel and Additional Charge as Chairman SAIL.