Price volatility sees IMFA's Q2 net plummet 83% to Rs 7.4 cr

This, despite marginal improvement in overall revenues and export earnings

Volatility in ferro chrome prices dented the Q2 net profit of leading producer Indian Metals & Ferro Alloys Ltd (IMFA).

During July-September quarter of 2017-18, IMFA's net profit tanked to Rs 7.37 crore compared to Rs 42.31 crore posted in the corresponding period of FY17. In the period, IMFA's ferro chrome production dipped four per cent to 58,413 tonnes. Sales, however, were up five per cent at 65,013 tonnes.

Subhrakant Panda, managing director & chief executive officer, IMFA said, "Ferro chrome has been quite volatile and the Q2 FY18 benchmark price was negotiated at a time when sentiments were poor on account of a temporary slowdown in offtake from China. While spot prices bounced back subsequently, we were unable to benefit having already finalised the quarterly contracts. Riding on positive sentiments, the pricing of long term contracts in the ongoing quarter is substantially higher and will yield healthy margins. Furthermore, going ahead we expect prices to move within a relatively narrow band".

IMFA's total revenue moved up 7.34 per cent from Rs 387.58 crore to Rs 416.03 crore in Q2. Exports in the quarter improved marginally from Rs 323.70 crore to Rs 344.94 crore.