BENGALURU (Reuters) – India’s Tata Steel on Monday reported a quarterly loss from a profit a year ago, hurt by a sharp fall in global steel prices and lower demand amid fears of a likely economic slowdown.
The steelmaker’s consolidated loss was at 25.02 billion Indian rupees ($302.71 million) for the three months to Dec. 31, against a profit of 95.98 billion rupees a year earlier. Total revenue from operations fell 6.1% to 570.84 billion rupees.
“Recession concerns weighed on steel prices, which coupled with elevated energy costs affected our performance,” T.V. Narendran, the chief executive officer said in a statement.
While steel prices were subdued in India, European operations witnessed margin compression due to lower realisations and elevated input costs, the company said.
Overall expenses surged 27% to 277.49 billion rupees, while input costs rose 27.2%.
“Looking ahead, there is visible pick up in steel prices across key regions on improved China demand outlook and sustained spending on infrastructure in India,” Narendran said.
Exports for Indian steelmakers have fallen since the government’s decision to introduce an export tax on certain steel intermediaries in May.
That sharp drop forced the government to lift the export tax in November, but steel companies have complained about a loss of share in traditional markets, including Europe.
The export duty weighed on the results of rival steelmakers, with Jindal Steel and Power reporting a nearly 68% fall in quarterly profit, while JSW Steel Ltd’s profit tanked 89%.
($1 = 82.6540 Indian rupees)
(This story has been corrected to fix the spelling of T.V. Narendran in paragraph 3.)
(Reporting by Nallur Sethuraman in Bengaluru; editing by Eileen Soreng)
