Sajjan Jindal-led JSW Steel on Friday reported a 56% year-on-year drop in net profit at Rs 168.2 crore net profit for the October-December quarter, mainly due to higher raw material costs and forex losses of Rs 500 crore caused by the depreciation of the rupee against the dollar. It had posted a profit of Rs 382.3 crore a year-ago.
In face of poor global demand and a ban on mining in Bellary district of Karnataka, JSW Steel managed to grow its crude steel production volume by 19% to 1.9 million tonnes in the quarter under review up from 1.6 million tonnes during the year ago period. It’s total sales revenue was Rs 7,859.6 crore up during the quarter under review against R5,771.4 crore for the corresponding quarter a year ago.
“Poor global demand and lower pricing also affected our net profit,” said Seshagiri Rao, CFO, JSW Steel. “Demand outlook for 2012 is better and we expect it to pick up in the second half the of year.”
To sustain the current 90% levels of production some relief on iron ore from the Supreme Court is necessary, he added.