JSW Steel's net up 54% Rs 2,695 cr, expansion soon

JSW Steel has posted a consolidated net profit of Rs 793.6 crore for the quarter ended March 31, as against Rs 611 crore for the same period last year. Net sales grew to Rs 7,209 crore versus Rs 5,441 crore in the same period last year.

Sajjan Jindal, vice-chairman and managing director, said, “Even when the global steel companies are struggling, JSW Steel has done well and posted its best ever quarter.” Adding, “Last year, the steel demand in India grew at 10 per cent and we expect it to be at 12 per cent for 2011-12. We are hoping it will remain robust.”

He said the company’s produce 8.75 million tonnes of crude steel in 2011-12. A 2.8-mt capacity blast furnace at its Vijayanagar (Bellary, Karnataka) facility was expected to be commissioned in June, taking the annual steel making capacity to 11 mt. The Vijayanagar plant will have a capacity of 10 mt.

The company, said Jindal, had decided to add another two mt of capacity at Vijayanagar for a total expenditure of Rs 2,695 crore. About Rs 945 was the equity part and the rest would be debt, already raised. Seshagiri Rao, joint managing director and group CFO, said, “It’s a dollar loan that we have raised for this expansion.” Talking about the quarter, Rao said, “The consolidated debt gearing for the company as on March 31 was 0.84:1 as against 1.65:1 last year.”

The Ebitda (earnings before interest, taxes, depreciation and amortisation) was Rs 1662 crore, up by 17 per cent, and the margins were at 23 per cent, higher sequentially but lower by three percentage points when compared against the fourth quarter of 2009-10.