Tata Metaliks, manufacturer and supplier of pig iron, on Monday said its consolidated net profit rose by 7 per cent to Rs 21.92 crore for the quarter ended September 30, 2016.
The firm had clocked a net profit of Rs 20.42 crore in the year-ago period, it said in a BSE filing.
Total income of the company fell by 3 per cent to Rs 342.85 crore in July-September quarter this fiscal from Rs 352.56 crore during the same quarter in 2015-16.
Total expenses of the firm were marginally lower at Rs 305.26 crore from Rs 315.08 crore during the period under review.
Tata Metaliks Managing Director Sanjiv Paul said the firm is going through a challenging external environment in terms of very high coal and coke prices, stagnation of demand in the market and liquidity issues with most of the infrastructure players.
"However, efforts are being made to improve realisations, reduce costs and improve quality further to deliver value to the customer of pig iron and DI pipes. As a result of increased DI pipe capacity, customer deliveries of higher value smaller sections of pipes have improved," he added.
Company is also planning to modernise and expand one of its blast furnaces through a proposed 70 days shut-down in Q3 2016-17, date of which will be finalised shortly, Paul said.
Post this modernisation, along with stabilisation of newly commissioned coke and power plant, the medium to long term cost competitiveness of the company would further improve, he added.
Global price of imported coal increased by 130 per cent and that of imported coke by 50 per cent during Q2 2016-17. On the other hand, price realisation of pig iron dropped by 5 per cent in Q2 2016-17 as compared to Q1 2016-17, the firm said.
"Outlook for Q3 2016-17 for pig iron business appears to be challenging as the coal and coke prices have increased very significantly and product prices are not increasing in the same proportion due to low demand of pig iron," it said.
However, full commissioning of coke plant and captive power plant projects in Q3 would enhance company's cost competitiveness, Tata Metaliks added.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
