SAIL net declines 34% to Rs 1,090 cr
The state-owned steel giant has said its profit fell to Rs 1,090 crore in the July-September quarter, while revenue rose 9% to Rs 11,697 crore.
By ET Bureau |
MUMBAI: Steel Authority of India, India’s biggest steelmaker by capacity, on Thursday said that while it posted a largest-ever sales volume in the fiscal second quarter, it could not prevent a 34% fall in net profit due to a sharp surge in coal prices.
The state-owned steel giant, which makes around 13 million tonne annually, said its profit fell to Rs 1,090 crore in the July-September quarter, while revenue rose 9% to Rs 11,697 crore.
SAIL, like Tata Steel, owns iron ore mines, but buys coking coal from the market. While the steel company gets 30% of its requirements from Coal India, it imports the rest from countries such as Australia and Indonesia.
“To make a tonne of steel, one needs almost a tonne of coal. Last year in the same period, coal prices were at $120 per tonne, in the second quarter they went up to $225,” said SAIL chairman CS Verma. For the third quarter, steel mills have finalised a contract price of $209 per tonne.
The high dependence on coal has prompted SAIL to step up its efforts to own coal mines. A mergers-and-acquisition team from SAIL is currently in Australia participating in a bidding for a coal mine. SAIL’s total sales in Q2 were 3.03 million tonne, an increase of over 30% over the preceding quarter, with value-added sales being 38% of the total sales. During the quarter, Sail’s net worth rose by Rs 1,090 crore to over Rs 35,583 crore as on September 30.
The state-owned steel giant, which makes around 13 million tonne annually, said its profit fell to Rs 1,090 crore in the July-September quarter, while revenue rose 9% to Rs 11,697 crore.
SAIL, like Tata Steel, owns iron ore mines, but buys coking coal from the market. While the steel company gets 30% of its requirements from Coal India, it imports the rest from countries such as Australia and Indonesia.
“To make a tonne of steel, one needs almost a tonne of coal. Last year in the same period, coal prices were at $120 per tonne, in the second quarter they went up to $225,” said SAIL chairman CS Verma. For the third quarter, steel mills have finalised a contract price of $209 per tonne.
The high dependence on coal has prompted SAIL to step up its efforts to own coal mines. A mergers-and-acquisition team from SAIL is currently in Australia participating in a bidding for a coal mine. SAIL’s total sales in Q2 were 3.03 million tonne, an increase of over 30% over the preceding quarter, with value-added sales being 38% of the total sales. During the quarter, Sail’s net worth rose by Rs 1,090 crore to over Rs 35,583 crore as on September 30.
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