Tata Metaliks net up to ₹77 cr on lower cost

Our Bureau Mumbai | Updated on June 11, 2020 Published on June 11, 2020

Tata Metaliks, a subsidiary of Tata Steel, reported a 20 per cent increase in the March quarter net profit at ₹77 crore, as against ₹64 crore logged in the same period last year, on the back of lower cost and higher realisation.

Revenue in the quarter was down 12 per cent at ₹522 crore (₹594 crore).

The Board has recommended a dividend of ₹2.50 a share.

Pig iron was up by 14 per cent while ductile iron pipe delivery during the quarter was down 25 per cent due to disruption in operations.

Total expenses were down 21 per cent at ₹428 crore (₹540 crore) with coke and coal cost falling by about 10-15 per cent improving the operating margin by 24 per cent from 14 per cent logged last year. Sales volume was lower due to suspension of supply chain owing to the lockdown in the second half of March.

Sandeep Kumar, Managing Director, Tata Metaliks, said though operating margins improved in December quarter, the uncertainty on the demand front owing to Covid pandemic and its full impact is not fully ascertainable.

The Pig iron business is seeing the effects of the lockdown, with most foundries struggling at 50-60 per cent capacity owing to labour and demand constraints. The company has been focussed on conserving cash and is fully geared up to manage any liquidity challenges that might arise due to the pandemic’s effect on the economy.

Completion timeline for the company’s DI Pipe expansion project which is currently under implementation, will get extended owing to the recent lockdowns that have impacted the supplies of imported equipment and shortage of labour, he said.

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Published on June 11, 2020
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