SAIL net profit zooms 98.6% in Q3
Domestic steel major SAIL reported a 98.7 per cent jump in net profit for the October-December 2009 quarter over the same period in 2008, largely on the back of upturn in demand for steel and lower raw material costs.business Updated: Jan 27, 2010 20:32 IST
It had a net profit of Rs 1,675.6 crore in 2009 over Rs 843.3 crore in 2008.
The turnover of the company also went up by 11 per cent from Rs 9,697.1 crore against Rs 8,724.4 crore in 2008. The sales of the company was higher by 25 per cent at 2.94 million tonnes during the quarter.
“There are two major factors for the high profitability....higher sales and lower raw material prices,” said S.K. Roongta, Domestic steel major Steel Authority of India Ltd (SAIL) on Wednesday reported a 98.7 per cent jump in net profit for the October-December 2009 quarter over the same period in 2008, largely on the back of upturn in demand for steel and lower raw material costs.chairman, SAIL. “Though cost of some raw materials like iron ore, ferro alloys, zinc and aluminium have gone up, cost of imported coal were much lower and that is reflected in the bottom line. We also have to factor that the period in 2008 was bad for the industry as a whole as sales had dipped and steel prices were very low. So low base also contributed to this.”
During the quarter, the company invested Rs 2,794 crore towards capacity expansion, which is 114 per cent higher than 2008. So far in this fiscal, SAIL has invested Rs 7,713 crore — up 138 per cent over 2008 — and Roongta said it is on track to invest Rs 10,350 crore towards capex for the full fiscal.
“We have not firmed up our capex for 2010-11 but in all likelihood it should be in the range of Rs 12,000-13,000 crore,” he added.