Jindal Steel and Power reported a 20 per cent dip in consolidated net profit at Rs 402 crore for the first quarter of the current fiscal due to higher depreciation and finance costs.
The company had recored Rs 501 crore profit in the year-ago period.
"A major increase in depreciation and financing costs and restructuring costs of WCL, Australia, caused net profit at consolidated level to drop by 20.5 per cent on year-on-year basis," JSPL's Managing Director and Group CEO Ravi Uppal told reporters here.
Depreciation and amortisation costs of the company went up by 58 per cent to Rs 667 crore during the reporting quarter from Rs 422 crore a year ago. Interest costs also doubled to Rs 535 crore form Rs 268 crore.
Turnover, however, went up by 10 per cent to Rs 4,978 crore in April-June quarter of current fiscal from Rs 4,540 crore a year ago on higher sales and net sales realisation.
The company, which has a net debt of Rs 37,500 crore, as on June-end, would look at consolidating assets rather than going for big-ticket capital expenditure.
Jindal Steel and Power Ltd's (JSPL) Group CFO K Rajagopal said in current fiscal the company would put in around Rs 6,000 crore capex, including Rs 1,900 crore already made, compared to around Rs 11,000 crore investment last fiscal.
He said net debt position of the company would not go up because of the proposed capex plan as JSPL would generate cash nearly of the same amount.
However, in order to dollarise its rupee loan and prune the high cost debt, JSPL might resort to some fund raising.
JSPL would also be looking at monetising some of non-core assets and core assets which do not have the prospect of cash generating in the short-term.
"The asset monetisation is not meant for paring debt, but because as these assets do not have the prospect of generating cash in the near-term," Rajagopal said.
Uppal said promoters have already appointed bankers to go out of the oil and gas venture. Jindal Petroleum, which is not a part of JSPL, owns seven oil and gas blocks in different parts of the world, including five in Georgia and one each in Bolivia and India.
"The deal is likely to happen in the current fiscal," he said.
To a question on acquisition of 100 per cent stake in Australian mining and exploration company Legend Mining's iron ore project in Cameroon for Rs 100 crore, he said the project is likely to start production in next 2-3 years and has around 400 million tonnes of reserve.
The Ngovayang Project, located in south-western region of the West African country, is aimed at securing raw material for JSPL's recently commissioned two million tonnes per annum (mtpa) steel plant in Oman. The project covers around 2,970 square km area comprising three exploration permits.
