Sesa Goa drops after poor Q4 results

The company announced Q4 results on Saturday, 27 April 2013.

Meanwhile, the S&P BSE Sensex was up 43.14 points or 0.22% at 19,329.86.

On BSE, 13,000 shares were traded in the counter as against average daily volume of 2.59 lakh shares in the past one quarter.

The stock hit high of Rs 151.70 and a low of Rs 150.10 so far during the day. The stock had hit a 52-week high of Rs 207.90 on 4 July 2012. The stock had hit a 52-week low of Rs 140.55 on 16 April 2013.

The stock had underperformed the market over the past one month till 26 April 2013, rising 0.63% compared with the Sensex's 3.11% gain. The scrip had also underperformed the market in past one quarter, sliding 16.95% as against Sensex's 4.06% fall.

The large-cap iron ore exporter has an equity capital of Rs 86.91 crore. Face value per share is Re 1.

Sesa Goa's consolidated net profit declined 15% to Rs 2280 crore on 69% drop in net sales to Rs 2554 crore in the year ended 31 March 2013 (FY 2013) over the year ended 31 March 2012 (FY 2012).

Sesa Goa said it has posted a loss before depreciation and taxes for Q4 March 2013 at Rs 206 crore, as against cash profit of Rs 1110 crore in Q4 March 2012. The cash profit for FY 2013 declined to Rs 23 crore from Rs 3235 crore in FY 2012 on account of suspension of iron ore operations, the company said in a statement.

Sesa Goa said that its iron ore operations were affected by the suspension of mining in Goa and Karnataka. On 18 April 2013, the Supreme Court of India has given clearance for resumption of mining operations for A and B category mines in Karnataka subject to statutory clearances. Sesa Goa's Karnataka mine falls under B category, and the company is awaiting statutory clearances, including forest clearance which expired in October 2012, to resume mining, the company said. The company said it expects to commence mining shortly, subject to the grant of statutory clearances.

Regarding the suspension of mining in Goa, the date for initial hearing is yet to be fixed by Supreme Court of India, Sesa Goa said. In the meantime, the State Government and major miners including Sesa Goa, have filed their responses to the Central Empowered Committee report, the company added. Separately, the company has filed an application to the Supreme Court seeking a stay on the suspension of mining and restrictions on ore transportation, Sesa Goa said in a statement.

In Q4 March 2013, production of pig iron and metallurgical coke were 75% and 48% higher at 1,04,000 tonnes and 94,000 tonnes, respectively, due to the new capacities commissioned in Q2 September 2012, the company said. For the full year, the production of pig iron and metallurgical coke grew by 24% and 29% respectively, Sesa Goa said in a statement.

Sesa Goa's power sales were 43 million units in Q4 March 2013 and 159 million units for FY 2013. Power sales are not comparable with the previous periods in view of Goa Energy acquisition in March 2012, and the commissioning of new 30 (megawatts) MW power plant, the company said in a statement.

During the year, Sesa Goa acquired the remaining 49% of the outstanding common shares of Western Cluster (thereby taking the equity interest in the project to 100%) for a cash consideration of $33.5 million.

With regard to the update on Sesa Sterlite merger, Sesa Goa said the proposed Vedanta Group Consolidation and Simplification has received the approval of the High Court of Bombay at Goa on 3 April 2013. The hearings at the High Court of Madras have been completed and the order is awaited, the company said. Following the receipt of Court Approvals, a record date will be announced to complete the transaction, Sesa Goa said in a statement.

Sesa Goa's board of directors at a meeting held on Saturday, 27 April 2013, recommended dividend of 10 paise per share for FY 2013.

Sesa is India's largest producer and exporter of iron ore in the private sector. The company is a majority owned and controlled subsidiary of Vedanta Resources plc, the London listed FTSE 100 diversified metals and mining major. For more than five decades, Sesa has been involved in iron ore exploration, mining, beneficiation and exports. Sesa is also into manufacturing pig iron and metallurgical coke, with a 0.28 million tonnes per annum (mtpa) metallurgical coke plant and a 0.25 mtpa pig iron plant in Goa.

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