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Jindal Steel and Power Ltd (JSPL) reported a growth of 18 per cent in standalone net profits and 15 per cent in revenues for the quarter-ended March 2011 over corresponding last quarter. This growth was driven by higher sales of iron ore pellets, steel products and power.
JSPL's standalone net profit stood at Rs 643.33 crore on total revenues of Rs 2,742.19 crore, as against a net profit of 548.99 crore on revenues of Rs 2,388.83 crore in the corresponding last quarter.
On a consolidated basis, the net profit for March quarter grew 4 per cent to Rs 1001.70 crore (Rs 963.38 crore in corresponding last quarter). Revenues were up 21 per cent to Rs 3,854.54 crore (Rs 3,175.59 crore).
Growth drivers
“Profit growth has largely come from the steel business. Though power production was up, it was consumed internally,” said Mr Sushil Maroo, Group CFO, JSPL. The company has maintained the operating profit margins, which increased to 42 per cent during the quarter, Mr Maroo said.
JSPL board declared a dividend of Rs 1.50 per share on par value of Re 1 each.
For financial year 2010-11, the standalone net profit was up 39 per cent to Rs 2,064.12 crore as against Rs 1,479.68 crore in the previous year. Revenue for the year was up 30 per cent to Rs 9,573.63 crore (Rs 7,367.59 crore). Consolidated net profit for the year grew 5 per cent to Rs 3,804.01 crore (Rs 3,634.56 crore), while revenue was up 18 per cent to Rs 13,111.60 crore (Rs 11,091.54 crore).
Capex plans
Mr Maroo said JSPL plans to Rs 13,000 crore on capital expenditure for fiscal 2011-12. Out of this, Rs 5,000 crore would be spent on steel projects and the rest on power projects. JSPL plans to fund its capex largely from internal accruals and has no plans to dilute equity or raise debt, Mr Maroo said.
The rising coking coal prices had not had a major impact on the company's bottomline. “We tried to use more of sponge iron in its product mix, which reduced the coking coal requirement,” Mr Maroo said.
Further, Mr Maroo expects the steel prices to remain stable in the year ahead. However, the power tariffs could soften a bit to around Rs 4 a unit, as more projects are expected to be commissioned during the year, Mr Maroo added.
In anticipation of better results, the JSPL stock gained 2.37 per cent to close at Rs 693.70 on the BSE on Thursday.
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