Jindal Stainless Q3 net loss widens to Rs 257 cr

Jindal Stainless net loss widened to Rs 257.39 crore in its third quarter ended December 2012, from Rs 110.33 crore in the same period of the previous fiscal, due to squeezed margins and higher interest payments.

Its total income, however, rose by over 35% to Rs 2,584.27 crore during the quarter vis-a-vis Rs 1,910.06 crore in the October-December period of 2011-12, the company said in a filing to the BSE.

Total expenditure of the largest domestic stainless steel maker, meanwhile, was more than its total income during the quarter and stood at Rs 2,634.34 crore.

Besides, its interest outgo was up over 110% to Rs 262.82 crore, while it incurred a forex loss of Rs 79.67 crore during the quarter.

In a separate statement, the company said, "Results have been adversely impacted during the quarter on account of stress on margins due to subdued global economic conditions and adverse exchange fluctuation arising on account of depreciation of Indian Rupee..."

It also attributed ramping up of its stainless steel production facility at Odisha as one of the reasons impacting company's results.

Moreover, it said that "interest cost for the quarter is high on account of increase in interest rates under the approved corporate debt restructuring (CDR) Rework scheme".

The reworked CDR scheme of the company was approved in September. In December, its Board had approved issuing preference shares worth Rs 200.54 crore to its promoters in two equal tranches on or before June 30, 2013 to meet the conditions of reworked CDR scheme.

The Ratan Jindal-led company is also in the process of restructuring its syndicated external commercial borrowings worth $250 million.

During the quarter, company's stainless steel melting production volume was up 19% to 2,62,884 tonne while its sales increased by 34% to 2,28,593 tonne.

On the outlook ahead, the company said global demand for stainless steel is expected to grow between 5-6% per annum. However, Indian demand is likely to see a growth of 8-9% as usage of stainless steel products have been increasing in the country.

Jindal Stainless stock was trading at Rs 61.50 in the late afternoon trade on the BSE, down 4.87% from the previous close.