JSW Steel today said it has reported 29 per cent rise in its July-September quarter consolidated net profit at Rs 836 crore due to record saleable steel sales aided by lower prices of key inputs, like coking coal.
Its consolidated net profit stood at Rs 647 crore in the corresponding period last year.
The Sajjan Jindal-led company said its revenue from operations also jumped by 17 per cent at Rs 16,818 crore in the quarter ended September 2017. The crude steel production during the quarter stood at 3.94 million tonnes. The production was impacted by continued water shortage in the South, particularly in Tamil Nadu, as well as availability of iron ore at Vijayanagar.
Saleable steel sales volume for the quarter was 3.92 million tonnes, up by two per cent YoY. The company liquidated a large part of the inventory that was built-up during the previous quarter in the run up to GST implementation, and consequently sales volumes increased 12 per cent QoQ during the quarter.
"Steel imports into India have gone up by more than 50 per cent, both sequentially as well as year on year. This has taken away the incremental demand arising in the country," JSW Steel joint managing director Seshagiri Rao told reporters here.
"Even though, globally steel prices went up, in India, steel prices were almost flat compared to Q1 due to unprecedented imports in the quarter, affecting net sales realisations. Rising imports of defective material and import of substandard products under the garb of prime products, especially in the coated segment is alarming," Rao said.
Crude steel production in India increased by 4.5 per cent YoY in H1FY18 and the apparent finished steel consumption grew by 4.3 per cent YoY.
However, consumption of domestically produced steel increased only by 2.8 per cent YoY as imports surged rapidly. Steel demand is expected to improve further with government focus on infrastructure build-up like roads, DFC, water & gas pipelines, metro, irrigation projects, solar energy, power T&D etc. Bank recapitalisation will pave way for an uptick in credit growth and possible restart of the investment cycle, he said.
Commenting on the company's bid for Bhushan Steel and other steel assets, Rao said, "We are still examining and take a call. JSW Steel has 18 MT capacity, which is 16 per cent of the country's total steel production. The government aims 300 MT production capacity and JSW Steel hopes to reach 40-45 MT capacity by 2030, Rao added.
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