Indian state-owned steel producer Steel Authority of
India Limited (
SAIL) has announced that during the last quarter of the Indian fiscal year FY 2010-11 that ended on March 31 it produced 3.43 million mt of saleable steel, up by five percent year on year, with capacity utilization of 126 percent. This contributed significantly to the company's production of 12.89 million metric tons of saleable steel during the given fiscal year, a growth of two percent over the previous year, with capacity utilization at 116 percent.
As regards the given quarter,
SAIL said that growth was recorded in the production of items such as electrode quality wire rods (37 percent), high tensile plates (29 percent), thermo-mechanically treated (TMT)-high corrosion resistant (HCR) wire rods and rounds (34 percent), LPG grade hot rolled coils/sheets (12 percent), SAILCOR hot and cold rolled products (69 percent), and 90-UTS rails (two percent) - all compared to the year-ago period.
In FY 2010-11,
SAIL's turnover increased by seven percent year on year, reaching INR 470.42 billion ($10.61 billion), while in the last quarter of the given fiscal year its turnover showed a quarter-on-quarter rise of seven percent, amounting to INR 131.37 billion ($2.96 billion), up by one percent year on year. According to
SAIL, its profitability during Q4 improved over the previous quarter due to better sales, despite market fluctuations and demand uncertainties. Thus, in Q4, its profit after tax totaled INR 15.07 billion ($339.9 million), with an improvement of 36 percent over the previous quarter. However, the sharp rise in prices of inputs, especially coal, during the year resulted in an adverse impact on the year-on-year comparison of Q4, and
SAIL's profit after tax which fell by 28 percent on year-on-year basis.
In the meantime, in FY 2010-2011 as a whole, rising raw material costs impacted
SAIL's financial performance by around INR 37.18 billion ($838.57 million), of which INR 31 million was on account of the increase in the price of imported
coking coal alone. In the given fiscal year,
SAIL's labor costs increased as well. These factors, and weakening market demand for flat products, were mainly responsible for
SAIL's FY 2010-2011 profit after tax falling 28 percent to INR 48.81 billion ($1.1 billion).