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JSW Steel Ltd reported a consolidated net profit of ₹466 crore for the December quarter against a loss of ₹74 crore in the year-ago period, thanks to better realisation and higher production.
Moreover, the Sajjan Jindal-led company avoided foreign exchange loss in the quarter unlike the ₹268-crore loss incurred last year, as it hedged the entire forex exposure. Sales realisations improved 51 per cent to ₹13,383 crore from ₹8,866 crore as the company targeted export markets aggressively.
On a standalone basis, net profit increased more than four times to ₹652 crore in October-December from ₹137 crore a year earlier. Sales were up 42 per cent at ₹11,731 crore against ₹8,275 crore, with exports more than doubling to ₹3,069 crore (₹1,465 crore). The EBITDA margin improved to 19.3 per cent from 15.3 per cent.
Seshagiri Rao, Joint Managing Director, JSW Steel, said besides better realisation, the company has improved the operational efficiency and produced more value-added steel during the quarter.
On the operational front, gas from the blast furnace has been used efficiently to produce power, he said. Asked whether JSW Steel is upset with the allotment of iron ore mine to South Korean steelmaker Posco in Odisha even before it could break the ground for its steel plant, Rao said it is unfairness on the policy side.
“It is unfortunate that we had not been considered for any mine even after investing ₹50,000 crore in steel making,” he said.
On plans to set up a steel plant in West Bengal, Rao said the company has requested the government to allow JSW Energy to set up a 660-MW power plant independently, pending the allotment of iron ore mine for building the steel plant.
Margin To Improve Going ahead, the company expects its profit margin to improve with the commissioning of coke oven and pallet plants at its Dolvi unit in Maharashtra. Besides, the availability of iron ore in Karnataka is set to improve with the Supreme Court directing the State and Central governments to submit an action plan to improve supply. The next Supreme Court hearing is slated for February 25.
The company’s net debt stood at ₹32,300 crore and net debt to equity was 1.49 times.
The company’s stock rose 1.61 per cent on the BSE on Tuesday to close at ₹930.
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