New Delhi: Tata Steel's consolidated net profit jumped over two-fold to Rs 763 crore in the April-June quarter of 2015-16 helped by strong sales from its Indian operation, cost optimisation and sale of non-core assets.
The Mumbai-based steel giant had posted a net profit of Rs 337.33 crore in the corresponding quarter of last fiscal.
Its consolidated total income, however, fell 17 per cent to Rs 30,300.33 crore during the April-June quarter this fiscal, from Rs 36,427.21 crore in the same period a year ago.
Total expenses fell 14 per cent to Rs 28,872.59 crore from Rs 33,704.92 crore in the reported quarter.
Steel deliveries fell to 6.33 million tonnes (MT) in the June quarter this fiscal from 6.46 MT in the year-ago period.
"Tata Steel continues its strategy of monetising non-core assets and has raised about Rs 1,000 crore during the quarter by selling a part of its equity portfolio," the steel maker said in a statement.
Strong focus on cash flow management has helped the company maintain underlying debt despite incurring more than Rs 3,200 crore on capex during the quarter, it added.
Tata Steel, counted among the top-ten global steel firms, had posted a net loss of Rs 5,674 crore in the last quarter of 2014-15.
Ignoring the good show on financial front, shares of Tata Steel dropped by 5.46 per cent to settle at Rs 246.90 on BSE.
Commenting on the performance, Tata Steel Group Executive Director (Finance and Corporate) Koushik Chatterjee said the firm has performed well despite rising imports and challenging market conditions.
"Our Indian operations reported better underlying performance despite the continued onslaught of imports and the many challenges in the market place, due to strong focus on costs, customer value management and productivity improvements," he said.
In Europe too, the imports into UK from China has risen substantially thereby depressing the prices and impacting the company's performance in this quarter, Chatterjee added.
Tata Steel Managing Director (India and South East Asia) TV Narendra said the Indian steel industry continues to bear the brunt of a surge in imports and tepid domestic demand which led to a sharp drop in steel prices over the quarter.
"Despite these macro headwinds, we were able to increase our deliveries by 2 per cent over last year. We continue to focus on enriching our product mix, improving our customer connect and strengthening our marketing franchise, which is yielding results across all our business verticals," he added.
Tata Steel Europe Chief Karl-Ulrich Kohler said market conditions worsened this year. Strategy to focus on customers and develop differentiated steel products have helped the firm stabilise its realisations.
"We have made good progress in building a large portfolio of advanced steel products. We are now shifting focus towards optimising sales of these products and towards the development of next-generation steels," he added.
