Steel giant SAIL on Friday reported a standalone net loss of Rs. 1,055.96 crore for the second quarter ended September 30, due to lower sales realisation.
The country’s largest steel maker had reported a profit of Rs. 649.49 crore in the year-ago period, the company said in a regulatory filing.
Total income declined by 20.7 per cent to Rs. 9,387.55 crore during the quarter under review as against Rs. 11,840.64 crore in the same quarter last fiscal, it said.
“SAIL’s financial performance has suffered mainly due to lower sales realisation which dropped by 24 per cent in the second quarter of FY16, over same quarter last year (corresponding to around Rs. 7,500 per tonne) and a decline in sales by 6.7 per cent,” the company said in a statement.
Although the sales in the long product segment registered a robust growth of 20 per cent over corresponding period last year, the sales of flat products declined by around 15 per cent primarily due to 75 days shutdown of the hot strip mill at Bokaro for its upgradation, the statement said.
SAIL incurred an additional expenditure of Rs. 280 crore towards contribution to District Mineral Fund (DMF) under MMDR Amendment Act, 2015. There has also been an increase in interest and depreciation related charges with commissioning of the new facilities under the on-going modernisation and expansion plan, it added.
The company’s performance is set to improve in the second half with completion of the upgradation of the Hot Strip Mill at Bokaro.
“This upgradation which includes installation of a new reversing roughing mill and heat shields would not only increase the capacity of the Hot Strip Mill from 3.9 mtpa (million tonnes per annum) to 4.2 mpta but would also improve the quality of the product,” it said.