During October-December 2012, leading steel maker JSW Steel posted 18 per cent decline in its net profit at Rs 137 crore (Rs 168 crore) owing to lower capacity utilisation.
Steel output was up 14 per cent at 2.17 million tonne. The capacity utilisation was at 78 per cent. The company could not use its capacity optimally because of shortage of iron ore, a key raw material. The firm posted a 5 percent rise in net sales to Rs 8,275 crore (Rs 7,860 crore). Earlier, the company said its consolidated results would be announced later.
During the quarter, it announced a forex loss of Rs 267 crore (Rs 500 crore in the same period last year). This was because of the four per cent depreciation in the rupee against the dollar. It also made a provision of Rs 60 crore towards carrying cost on its Rs 3,079-crore investment in US Plate and Pipe mill.
Justifying the provision, JSW Steel said it would be prudent to set aside the amount though the subsidiary may have a longer gestation period than originally planned.
According to the Supreme Court directive given 17 months before, NMDC was to produce one million tonne of iron ore per month. But it is unable to produce it. So far only six mines of Category ‘A’ resumed operations. These mines produced 0.71 million tonnes so far but it has not been put on e-auction. In this backdrop, the company expects improvement in availability of ore in the March quarter.