State-owned miner NMDC today reported a 22.45% growth in net profit to Rs 1,858.81 crore for the quarter ended December 31, 2011, largely due to higher realisation from the sale of iron ore.
The company had reported a net profit of Rs 1,518.03 crore for the corresponding quarter of 2010-11.
Net sales of the company stood at Rs 2,821.95 crore during the quarter, a 7.68% increase from Rs 2,621.22 crore in Q3 last fiscal, it said in a filing to the Bombay Stock Exchange (BSE).
The company expects to achieve a growth of about 8% in iron ore production to about 27 million tonne during the current fiscal. During the first nine months of the current fiscal, it produced about 20 million tonnes of iron ore.
On the sales front, the company sold about 7 million tonnes of iron ore during the quarter. However, realisation was higher due to the Supreme Court mandated e-auction of iron ore in Karnataka, where it operates two mines and is only company authorised by the apex court to mine ore in the state.
The largest domestic iron ore producing company also made its first overseas acquisition during the quarter, purchasing a 50% stake in Australia's Legacy Iron Ore for about Rs 92 crore.
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It is also doing due diligence to acquire two another Australian properties -- the Ridley iron ore deposit of Atlas Mining and the Wonarah phosphate reserve of Minemakers Ltd. The process is expected to be completed in the next one or two months.
On the domestic front, construction of the company's first steel plant of 3-million tonne per annum capacity in Chhattisgarh's Nagarnar district is in full swing, as most of the packages have been awarded for the project. The plant is expected to be commissioned in 2014.
During the quarter, the company also signed an agreement with Russia's Severstal to set up a steel plant in Karnataka, which will have an initial production capacity of 3 MTPA. NMDC will supply iron ore to the plant, while coking coal will be sourced from the Russian firm's mines.
Shares of the company closed at Rs 178.85 apiece on the BSE today, up 2.61%.