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Informist, Tuesday, Feb. 11, 2025

 

By Anshul Choudhary

 

MUMBAI – Steel Authority of India Ltd. continues to see dismal earnings performance due to weak product prices amid cheap imports. Its net profit during the December quarter fell over 62% on year, marking the fifth straight quarter of year-on-year decline in the measure for the company. However, the company managed to report a growth in revenues after four quarters of decline as sales volume in the December quarter was higher.

 

The steel major posted a net profit of INR 1.26 billion during the quarter. Nine analysts had expected the company to report a net profit of INR 3.09 billion, while three analysts had expected it to report a net loss of INR 2.44 billion.

 

At the same time, the company's revenue in the quarter rose nearly 5% on year to INR 244.90 billion, better than analysts' expectations of INR 238.45 billion. This was driven by better sales volume, which rose to 4.43 million tonnes in the December quarter as compared with 3.81 million tonnes a year ago. Its crude steel production during the quarter was slightly lower at 4.63 million tonnes.

 

While the company's revenue rose on year, slightly higher expenses and taxes affected profitablity. Overall, the company's expenses during the quarter rose over 6% on year to INR 245.64 billion. Its tax outgo rose to INR 1.92 billion as compared with INR 1.29 billion a year ago.

 

The company's operating profit, as denoted by the earnings before interest, tax, depreciation, and amortisation, rose 3% on year to INR 23.89 billion. The operating profit was down 25% compared to the September quarter.

 

"In the face of a challenging steel market characterized by declining prices and an influx of cheap imports, SAIL has managed to achieve better EBITDA during the Q3FY25 (Oct-Dec) eompared to the corresponding period last year," the company said in press release along with the quarterly results.

 

For the nine months ended December, SAIL's net profit fell nearly 44% on year to INR 9.70 billion and revenue fell 5.5% to INR 731.62 billion. Tuesday, shares of the company closed at INR 100.02 on the National Stock Exchange, down 4.9%.  End

 

Edited by Deepshikha Bhardwaj

 

 

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