JSW Steel has reported a jump of 64% growth in its April-June quarter profit at Rs 405, on the back of strong steel demand and higher prices. Going forward, growing concerns about cost pressures and falling prices could cloud earnings, say analysts.
Net sales shot up 54% to Rs 7,432 crore from Rs 4,818 crore year-on-year. CNBC-TV18 poll saw net profit at Rs 410 crore and net sales at Rs 6,800 crore ahead of the result announcement.
Seshagiri Rao, joint managing director and group CFO said, “We saw a significant volume growth, both in crude steel and rolled flat products and even rolled long products during the quarter.” Rao indicated that going forward global recovery from its international operations continues to be fragile in the shadow of Eurozone crisis, US unemployment, Japan restructuring and China slowdown.
Rao added that the company expected to produce 8.75 million tonnes of steel in FY12, compared to 6.42 million tonnss last year. He also said the company's sales target for this year was 9 million tonnes, compared with 6 million tons Y-o-Y.
The company reported a decline in its EBITDA margin to 19.3% versus 22.4% year-on-year on the back of high input cost. Meanwhile shares of the company surged 0.13% to close the day at Rs 870.35 on the Bombay Stock Exchange post the result announcement.
Source: www.moneycontrol.com
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