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JSW reports net loss of ₹582 crores. First loss in six years

JSW Steel, India’s second-largest private steel producer, on Friday reported a net loss of ₹582 crores in the June quarter—its first loss in over six years —with demand for steel dragged down by the coronavirus outbreak.

Sajjan Jindal-led company has reported a net loss of ₹582 and the profit reported in the year-ago quarter was ₹1,008 crore.

An outbreak of COVID-19 was reported at JSW’s primary steel plant Toranagallu Steel Works in Karnataka, affecting more than 500 workers, becoming an industrial cluster with a large number of COVID-19 cases in the state.

Earnings, Production Guidance And Debt

  • Southern and western India have been impacted more by Covid-19.
  • Lack of credit flows, destruction in demand and worker shortage were some of the challenges during the quarter.
  • Impact of lower iron ore and natural gas prices partially offset by higher coking coal and power costs.
  • June quarter results effectively includes performance for only two months.
  • Net sales realisation down by 12% quarter-on-quarter to Rs 4,000 per tonne.
  • Cumulative losses of overseas subsidiary stood at Rs 247 crore for the quarter.
  • Covid-19 impact at Vijayanagar unit weighed on operating performance.
  • Would be able to meet FY21 production guidance target of 16 million tonnes and sales of 15 million tonnes.
  • 90% capacity utilisation achieved at Vijayanagar unit; worker availability is improving.
  • Working closely with engineering, capital goods and automotive industry for exports.

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