Q3 results: JSW Steel net profit tumbles 88% to Rs 187 cr from Rs 1,603 cr

JSW Steel on Friday posted an 88.33 per cent decline in its consolidated net profit to Rs 187 crore for the December 2019 quarter.

The company had posted a consolidated net profit of Rs 1,603 crore in the year-ago period, JSW Steel said in a filing to the BSE.

"The net profit after tax for the quarter was Rs 187 crore, after incorporating the financials of subsidiaries and joint ventures," the company said in a statement.

Its consolidated income during the October-December 2019 period was Rs 18,182 crore, registering a fall of 10.6 per cent over the year-ago period, the filing said.

The company's crude steel production during the October-December 2019 period stood at 4.02 million tonne (MT), up five per cent quarter-on-quarter.

"Production in the quarter was lower by five per cent y-o-y due to extended monsoon which impacted operations at both Dolvi and Vijayanagar," the statement said.

After a weak momentum during the first half of the year, the current quarter witnessed a turnaround in business sentiment and better liquidity conditions, driving an overall improvement in steel demand and pricing from November onwards, it said.

"A large part of this demand improvement is from infrastructure and construction sectors," the company said.

"Following a period of prolonged inventory adjustment (de-stocking) in the first half, the initial spurt in demand was driven by restocking in the supply chain. As a result, the company was able to liquidate a large part of the inventory that was accumulated in the first half, primarily by selling more in the domestic markets," it said.

On the outlook, the company said the domestic steel sector is expected to grow significantly on the back of various initiatives of the government pertaining to the domestic infrastructure and supportive monetary policies.