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Tisco Q1 net dips 8.5 pc to Rs 248 million, slows BSE bull-run

Tata Iron and Steel Company Limited has reported 3.78 per cent increase in operating profit to Rs 2.36 billion in first quarter of current financial year against Rs 2.27 billion in the corresponding period of the previous year.

Profit after tax, however, declined by 8.50 per cent to Rs 248 million from Rs 271 million on account of higher depreciation and interest charges due to commissioning of Phase IV facilities as part of modernisation.

Compared to the first quarter of the previous fiscal, Tisco achieved an increase of 3.19 per cent in production to 748,253 tonnes from 725,120 tonnes and 6.65 per cent in sales to 656,662 tonnes from 615,700 tonnes.

Net sales of the company increased by 5.51 per cent to Rs 14.27 billion from Rs 13.52 billion while expenditure increased to Rs 11.91 billion from Rs 11.25 billion.

Stock brokers in Bombay said that the first quarter results were below the market expectations. This affected the market sentiment, checking the ten-day-long bull run at the Bombay Stock Exchange.

The Tisco scrip declined sharply by Rs 13.50 to Rs 158.

After three successive years of recessionary conditions, the Indian steel market is showing signs of a revival, company sources claimed. They said demand for flat products is firming up, although the domestic prices are still lower than those in the corresponding first quarter of the previous year, mainly due to excess supply .

Interest burden of the company increased by 10.56 per cent to Rs 858.4 million from Rs 776.4 million last year while provision on account of depreciation increased by 14.29 per cent to Rs 1.04 billion from Rs 910 million in the same quarter of previous year.

Expenses on Employees Separation Compensation, however, was lower at Rs 322.7 million (Rs 367.2 million) while profit before tax came down to Rs 282.9 million from Rs 315.2 million last year.

Provision on account of taxation was lower at Rs 35 million compared with Rs 44.3 million made in first quarter of last fiscal.

The cold rolling mill project in Jamshedpur works is progressing satisfactorily and within the budget, sources said.

UNI

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