Tata Steel on Friday posted a net profit of Rs 5,346.6 crore for the first quarter, a three-fold jump from the Rs 1,825.2 crore it logged in the corresponding period last year due to a one-time gain from sale of stakes in Australian mining firms Riversdale and Tata Refractories.The company warned high raw material costs and global economic uncertainty would keep its margins under pressure. "High raw material prices and monetary tightening in India remain cause for concern," managing director HM Nerurkar said in a statement.
The company’s total income jumped by 35% in the quarter from Rs 27,253 crore for the quarter ended June 30, 2010 to Rs 36,882 crore for the quarter ended June 30, 2011.
The company said that in the April-June quarter, the company realised Rs 4,942 crore by selling its entire 26.3% stake in the Riversdale to Rio Tinto. It also included Rs 2,879 crore as one time profit in its results from the sale of its stake in Riversdale.
The company made a profit of Rs 511 crore by selling its stake in Tata Refractories to Krosaki Harima Corporation, an associate firm of Nippon Steel of Japan. Tata Steel, in May, had offloaded 51% stake in-group company Tata Refractories to Krosaki Harima and inducted the Japanese firm as a strategic partner. The deal was valued at Rs 576 crore, going by the Tata Refractories’s valuation at Rs 1,130 crore.