JSW Steel net up 151%, expects steel prices to rise in Q3

New Delhi, July 24 (UNI) JSW Steel Ltd today said it has posted 151 per cent jump in its net profit to Rs 427.78 crore for the quarter ended June 30, 2007 compared to Rs 170.30 crore for the corresponding quarter last year Its total income has increased by 31 per cent to Rs 2327.2 crore for the QIFY07 compared to Rs 1597.96 crore in the corresponding period last year, said a statement.

The consolidated results of the group posted net profit of Rs 429.13 crore for the quarter ended June 30, 2007.

Its total income stood at Rs 2338.86 crore for Q1FY07.

In its outlook, JSW Steel said the global crude steel production grew at 8.4 per cent during H1, 2007 mainly led by 17.8 per cent growth in China.

Chinese exports are higher in first six months at 35 million metric tonne. US had a marginal positive GDP growth in Q1, 2007 due to slowing economy, lower auto production and decelerating construction.

However, JSW says rising demand for pipes and plates is noticed in the US, driven by booming oil and gas industry. Monsoon in Asia has slowed down construction activities.

The international prices of steel products as a consequence of above factors, has come down by around 7-10 per cent. The appreciating Rupee against the Dollar and the lower international steel prices led to an adjustment of the prices for JSW in the domestic market by around Rs 600-800 per tonne from July 01, 2007.

The recent policy announcements by Chinese Government to restrict steel exports by introducing licensing procedures, reducing export rebates and introducing taxes on exports are expected to slow down the export of steel products from China, added JSW.

It is reported that the inventories at various service centres are coming down and the demand continues to be buoyant. Indian economy has shown robust growth in the current financial year backed by a growth of 11.7 per cent in the industrial production in April/May 2007.

Lower inflation reported recently is expected to result in lower interest rate regime, which will spur growth in automobile and Retail sector, a big positive for steel industry says JSW.

In this scenario, JSW expect steel prices to remain stable and may pick-up from third quarter.

UNI