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SAIL profit drops 28% on lower prices, higher input costs

31 Jul 2009 Evaluate

Steel Authority of India Ltd (SAIL) has reported a 27.7 per cent drop in its net profit at Rs 1,326.1 crore for the first quarter ended June 30, 2009, compared with Rs 1,835.2 crore in the same period of last year.

 

SAIL attributed the fall in profits to higher inventory costs, rise in cost of inputs such as coking coal and a drop in steel prices. Total income fell 15.1 per cent to Rs 9,692.8 crore as compared to Rs 11,422.0 crore. Overall production increased 4 per cent, while production of value-added products increased 12 per cent.

 

In the last two months, prices have improved in the global steel market. SAIL expects a growth in the second quarter adding that there has been a 10-12 per cent rise in production and a 12-13 per cent increase in sales the month of July. SAIL plans to invest about Rs 10,300 crore on expansion.

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