Jindal Steel Q3 Profits Badly Hurt by Export Duty

SEATTLE (Scrap Monster): Jindal Steel and Power Limited (JSPL) reported notable dip in profits during the third quarter of FY23.

The company’s consolidated net profits from continuing operations fell sharply by 68% to INR 5.19 billion during the three-month period ending 31^st December, 2022. The total revenue from operations declined marginally from INR 125.25 billion to INR 124.52 billion, said the company press release.

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The steelmaker reported standalone production of 2.06 Mt during the quarter, which was 13% higher than the prior quarter. The gross revenue for the quarter recorded decline by 9% quarter-on-quarter to INR 13,831 crore, mainly on account of lower volumes. The exports accounted for 5% of sales volume, as a result of weak global demand and continuation of export duty till November 2022. It must be noted that the contribution of JSPL’s exports to its sales on a standalone basis stood at 23% a year before.

The construction demand started to pick up towards the end of the quarter, thus resulting in improved steel prices.

Commenting on the industry trends, JSPL noted that the country’s crude steel production and domestic consumption surged higher by 2% and 8% respectively over the prior quarter. The long steel as well as the flat steel prices trended down during the beginning of the quarter, but gained strength towards the end. The prices of iron ore and coking coal increased, driven by rising global demand.