Earnings Review
SAIL revenue growth at 17-qtr low, but meets Street view
This story was originally published at 21:43 IST on 7 November 2024
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--SAIL Jul-Sept net profit INR 8.34 bln vs INR 12.41 bln year ago
--SAIL Jul-Sept revenue INR 264.75 bln vs INR 297.14 bln year ago
--SAIL Apr-Sept net profit INR 8.44 bln vs INR 13.90 bln year ago
--SAIL Apr-Sept revenue INR 486.72 bln vs INR 540.71 bln year ago
--SAIL Jul-Sept crude steel production 4.76 mln tn vs 4.80 mln tn year ago
--SAIL Jul-Sept crude steel production 4.76 mln tn vs 4.68 mln tn qtr ago
--SAIL Jul-Sept sales volume 4.10 mln tn vs 4.77 mln tn year ago
--SAIL Jul-Sept sales volume 4.10 mln tn vs 4.01 mln tn qtr ago
--SAIL Jul-Sept EBITDA INR 31.74 bln vs INR 40.43 bln year ago
--SAIL Jul-Sept EBITDA INR 31.74 bln vs INR 24.20 bln qtr ago
--SAIL Chairman: See downtrend in steel imports going forward
By Rajesh Gajra
MUMBAI – Volume degrowth and a fall in steel prices pulled down Steel Authority of India Ltd's year-on-year top line growth rate to a 17-quarter low in the quarter ended September, but the company managed to meet market expectations. The bottom line was hit by a fall in revenue and operating profit.
The steel major posted a net profit of INR 8.34 billion, significantly above analysts' estimate of INR 535 million. In the year-ago quarter there were exceptional expense or loss items of INR 4.15 billion. Adjusting for this, the year-ago net profit was INR 16.56 billion. The company hence posted a net profit fall of nearly 50% on year in the September quarter.
The revenue from operations fell 17% on year to INR 246.75 billion, slightly above the Street's estimate of INR 246.31 billion. The 17% fall was the worst revenue growth in at least 17 quarters.
The hit on SAIL's revenue in Jul-Sept was on account of a 14% on-year fall in sales volume to 4.10 million tonnes. The crude steel production, however, declined only slightly to 4.76 million tonnes from 4.80 million tonnes.
Cheaper steel imports and a decrease in steel prices were the main factors adversely impacting the operational performance, the company said in a press release. Sequentially, SAIL's revenue was up 2.8% on the back of a 2.2% increase in sales volume. The crude steel production went up 1.7% on quarter.
The company's operating profit, as denoted by the earnings before interest, tax, depreciation, and amortisation, fell 21% on year and rose 31% on quarter to INR 31.74 billion. The EBITDA margin, calculated by Informist as a percentage of the revenue from operations, contracted to 12.86% in Jul-Sept from 13.61% a year ago.
In the first half ended September, SAIL's net profit was down 39% on year to INR 8.44 billion and the revenue from operations was down 10% to INR 486.72 billion. Shares of SAIL ended Thursday 0.4% lower at INR 123.36 rupees on the National Stock Exchange. End
Edited by Deepshikha Bhardwaj
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