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JSW Steel’s net profit more than halved to Rs 269 crore due to a forex loss of Rs 592 crore in the June quarter. Sales were up 28 per cent.
On a consolidated basis, the company’s net profit plunged 88 per cent to Rs 50 crore (Rs 485 crore) after considering a loss of Rs 160 crore recorded by associate companies.
JSW Ispat accounted for a bulk of the losses. Net sales were up 33 per cent at Rs 9,902 crore on the back of improved performance in its US steel mill and Chile iron ore mine.
Mr Seshagiri Rao, Joint Managing Director, said that despite iron ore shortage and slowing steel demand, the company managed the highest ever quarterly production of crude steel of 2.14 million tonnes, which is up 27 per cent.
The lifting of the ban on iron ore mining in Karnataka would be the key to achieving the annual production target of 8.5 million tonnes, he added.
JSW Steel requires 1.5 million tonnes of iron ore every month and has a stockpile of four million tonnes bought over in the e-auction conducted by MSTC.
“Of the total stockpile, the quality of about one million is inferior and cannot be used. We have to consider alternative sourcing avenues if the mines are not opened up before August,” said Mr Rao.
The capacity utilisation at the company’s 10 million tonne a year Vijayanagar plant was 80 per cent due to iron ore shortage.
JSW Steel expects to revive work at its 10 mt a year West Bengal project this year.
It has spent close to Rs 500 crore on the project.
Officials said that iron ore and coal prices have bottomed out, while steel prices are expected to stabilise at the current level.
JSW Steel shares on the BSE were down 4 per cent at Rs 645 on Thursday.
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