)
Shares of Tata Steel dipped nearly 3% to Rs 359 on the BSE after the company posted a drop of 68% in its consolidated net profit at Rs 157 crore for the quarter ended December, 2014.
The company’s turnover was lower by 8% at Rs.33,633 crore, while the operating profit declined by 215 to Rs.3,090 crore.
The company’s performance was impacted by adverse macro headwinds in terms of declining commodity prices, increasing Chinese exports and lower demand in India, according to a company statement.
It also faced significant regulatory challenges in India which impacted raw material sourcing. “However, stronger performance in the European business, various cost savings measures across geographies and robust risk management of raw material security helped the company limit the impact on its profitability,’’ Tata Steel Group ED (Finance & Corporate) Koushik Chatterjee said.
In its Indian operations, deliveries rose to 2.13 million tonnes (2.07 million tonnes), while the net profit declined to Rs.881 crore (Rs.1,519 crore). The turnover declined to Rs.9,897 crore (Rs.10,143 crore), while the operating profit was down at Rs.1,979 crore (Rs.3,131 crore).
“Indian steel demand remained subdued during the quarter and domestic steel prices witnessed further deterioration due to the continued softening of global steel prices coupled with significant imports from China and Russia,’’ T. V. Narendran, Managing Director, Tata Steel India and South East Asia, said in a statement. He attributed the lower profitability to the fall in realisations coupled with the disruption in the company captive mining operations.
The stock opened at Rs 358 and touched a low of Rs 355 on the BSE. A total of 169,887 shares changed hands on the BSE so far.
