Date:31/01/2006 URL: http://www.thehindubusinessline.com/2006/01/31/stories/2006013101911400.htm

Back Essar Steel Q3 slips 30 pc

Our Bureau

Mumbai , Jan. 30

ESSAR Steel Ltd has reported a 30 per cent drop in its third quarter net profit at Rs 138.44 crore against Rs 197.54 crore in the year-ago period.

Rising costs of inputs such as iron ore, gas, iron ore fines and other raw material, coupled with falling prices of finished steel in domestic and international markets had an impact on the profitability.

Revenues for the quarter ended December 31, 2005 stood at Rs 1,441.57 crore compared to Rs 1,428.95 crore in the corresponding period of the previous year.

The commissioning of the cold rolling complex at Hazira, the beneficiation plant at Bailadilla and the slurry pipeline from Bailadilla to Visakhapatnam are expected to safeguard the company's profitability and growth in the long term, the company said in a news release.

Net profit in the nine-month period grew by 41 per cent to Rs 447.89 crore (Rs 317.37 crore).

Total sales for the quarter in volume terms stood at 0.61 million tonnes compared to 0.615 mt during the same period last year. While domestic sales stood at 0.47 mt (0.47 mt), exports sales stood at 0.14 mt (0.145 mt).

Although, volumes grew, the softening of steel prices had an impact on revenues and profits.

Shares of Essar Steel moved down by Rs 1.75 to Rs 40.05 on the BSE.