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JSW Steel Falls After Profit Declines 42% In September Quarter

JSW Steel Falls After Profit Declines 42% In September Quarter

JSW Steel's crude steel production rose 30 per cent to 3.85 million tonnes.

Shares of the Mumbai-based steel maker - JSW Steel - fell as much as 4.48 per cent to hit an intraday low of Rs 306.65 after it reported September quarter earnings on Saturday. JSW Steel's net profit declined 42 per cent to Rs 1,692 crore in July-September period as against Rs 2,917 crore during the same period last year. On a sequential basis, however, the company turned profitable as it reported a loss of Rs 146 crore in the previous quarter, the company's exchange filing showed.

JSW Steel's revenue sales advanced 12 per cent to Rs 16,487 crore versus Rs 14,752 crore in the same period last year. Its earnings before interest, tax, depreciation and amortization (EBITDA) or operating profit advanced 25 per cent to Rs 4,176 crore.

"The operating costs were down primarily on account of lower prices of imported coal, better operating leverage and savings in procurement costs and fixed overheads. However, this benefit in cost was partially offset by increase in the iron ore prices," JSW Steel said in a press release.

On sequential basis, JSW Steel's crude steel production rose 30 per cent to 3.85 million tonnes and saleable steel sales rose 47 per cent to 4.12 million tonnes, the company's release added.

"Following the 66 per cent capacity utilisation in the first quarter of Fiscal year 2021 marked by nationwide lockdown, disrupted supply chains and steep drop in demand, second quarter witnessed a sharp rebound in business sentiments and a significant improvement in the domestic economic activities spurred by slew of monetary and fiscal initiatives," the Sajjan Jindal-promoted company said.

The company achieved an average capacity utilisation level of 86 per cent for the quarter. This is in line with that of pre-Covid levels of 85 per cent achieved in the second quarter of the previous year. Crude steel production during the period stood at 3.85 Million tonnes, the company said.

As of 11:39 am, JSW Steel shares traded 4.28 per cent lower at Rs 307.20, underperforming the Nifty which was down 0.61 per cent.