SAIL net plummets 28%

Steel Authority of India today reported a 28 per dip in net profit for the quarter ended March 31 to Rs 1,507.12 crore compared to Rs.2,084.90 crore in the same period last year.

Total income of the company during January-March quarter of 2010-11 was Rs 12,166.43 crore, marginally lower than Rs 12,229.76 crore in the same quarter in the previous financial year. The company’s net profit in the last year dropped 29 per cent to Rs 4,881.25 crore against Rs 6,754.4 crore.

“The dip in the profit was mainly due to high cost of coking coal, which had an adverse impact our profits. The rise in input costs impacted SAIL’s financial performance in 2010-11 to Rs. 3,718 crore, of which Rs 3,100 crore was on account of increase in price of imported coking coal alone,” Chairman C S Verma said today.

Prices of coking coal hovered around $212 per tonne on an average compared to $128 per tonne in 2009-10.

SAIL produced 3.43 million tonnes (mt) of saleable steel during the last quarter of 2010-2011, a growth of five per cent over 2009-10, with capacity utilisation of 16 per cent.

This financial year, the company plans to spend Rs 14,337 crore over Rs 10,600 crore last year. It would soon commission two blast furnaces that would increase its hot metal production to 19.5 MTPA from 14 MTPA currently.

SAIL is expected to sign the joint venture agreement with Japan’s Kobe Steel by June to set up a plant based on Japanese ITMk3 technology to produce iron nuggets. This would be a 50:50 joint venture entailing total investment of $350 million. The company’s much-awaited share sale is expected to hit the markets by early June, Verma said.