(Reuters) -Tata Steel, India’s second-biggest steelmaker by market cap, reported a bigger-than-expected rise in quarterly profit on Monday, helped by a dip in input costs.
Its consolidated net profit rose more than twofold to 13.01 billion rupees ($153.32 million) in the quarter ended March 31, ahead of analysts’ estimates of 10.63 billion rupees, according to data compiled by LSEG.
In the corresponding quarter a year earlier, it logged exceptional charges worth 6.49 billion rupees related to the closure of a block in Odisha state and expenses related to its European operations.
Analysts said costs of coking coal and iron ore – key steelmaking raw materials – declined in the quarter, helping the profit for steelmakers like Tata Steel.
The company’s total expenses dropped 4.1% to 541.68 billion rupees, as cost of materials consumed, which constitutes over 30% of its expenses, fell 18.5%.
The Tata Group company said its total revenue from operations fell 4.2% to 562.18 billion rupees, while analysts’ expected revenue of 567.17 billion rupees, according to data compiled by LSEG.
Tata Steel’s results come weeks after India imposed a 12% temporary tariff, or safeguard duty, on some steel imports, aimed at helping domestic mills, which had to scale down operations and mull job cuts due to cheaper shipments from China, South Korea and Japan.
Analysts said realisations for domestic mills improved sequentially as prices marginally recovered after a prolonged period of decline. However, Tata Steel’s volumes were affected in the quarter due to relining in its Jamshedpur blast furnace.
Larger rival JSW Steel yet to report quarterly results later this month.
($1 = 84.8560 Indian rupees)
(Reporting by Manvi Pant and Anuran Sadhu in Bengaluru; Editing by Tasim Zahid)
