By Manvi Pant and Anuran Sadhu
(Reuters) -India’s top steelmaker JSW Steel expects improved earnings in the current quarter due to slightly higher steel prices, it said on Friday, after fourth-quarter profit missed estimates on weak pricing.
“Price increases in March and April will reflect in first-quarter realisations,” said CEO Jayant Acharya in a post-earnings call, adding that a drop in costs of coking coal — a key raw material — will also help the current quarter’s earnings. Realisations are a metric of profitability for steel companies.
Earlier in the day, the company posted consolidated net profit of 15.03 billion rupees ($176 million) for the three months ended March 31, below analysts’ estimate of 15.66 billion rupees, as per data compiled by LSEG.
It logged a one-time charge worth 440 million rupees, related to duty on assets bought by its green steel unit.
The results come a month after the government imposed a temporary 12% tax on some steel imports, known locally as a safeguard duty.
Domestic steel mills have had to scale down operations and consider job cuts due to a surge in cheap imports from China, Japan and South Korea.
As a result, the company’s total revenue from operations declined 3% to 448.19 billion rupees, missing analysts’ average estimates of 449.38 billion rupees.
Earlier this month, India’s top court quashed JSW Steel’s resolution plan to acquire Bhushan Power and Steel four years after the takeover was completed, and ordered the liquidation of the debt-ridden firm.
JSW Steel, which had said it sees no impact from the order, said on Friday that “no provision is required to be made for the net assets included in the consolidated financial results.”
Last week, rival Tata Steel posted an over two-fold jump in profit, beating estimates, on lower input costs.
($1 = 85.2420 Indian rupees)
(Reporting by Anuran Sadhu and Manvi Pant in Bengaluru; Editing by Janane Venkatraman, Eileen Soreng and Sahal Muhammed)
