Leading steel maker JSW Steel's net income tanked 64 per cent to Rs 867 crore despite lower raw material costs that led to a marginal increase in revenue, due to weaker realisation from exports and strong competition from Chinese steel.
The company's revenue came in at Rs 42,943 crore, up from Rs 42,213 crore in the year-ago quarter, the Sajjan Jindal-led company said on Friday.
The massive plunge in the bottom line and overall poor set of numbers sent its stocks plunging by over 4.5 per cent to Rs 889.45, which also led to a blood bath in the overall metal counters. Against this the broader indices closed 1 per cent down ahead of the next week’s budget.
The company said the domestic market saw an increased supply of the commodity, especially from cheaper imports from China.
Steel exports fell 51.1 per cent sequentially and 35.8 per cent on-year to 1.49 mt. The country remained a net importer of the alloy in the reporting quarter as was the case last year too. Elevated imports particularly from China and from the FTA countries pose a challenge to the domestic steel industry, the company said.
On a standalone basis, June quarter net was Rs 1,205 crore, down 29 percent on-year, while revenue from operations was flat at Rs 32,654 crore, due to lower sales volumes.
Consolidated crude steel production in the quarter stood at 6.35 million tonne. The company had a capex of Rs Rs 4,466 crore.