STEEL SECTOR: Q1 ( APR – JUN ’17 ) RESULTS AND ANALYSIS
Q1 – FY 2017-18 was bad for the Indian STEEL sector. Almost all the companies have posted a weak set of numbers in the quarter.
For the numbers, only 1 company out of 5 able to registered positive improvements both in the Revenue as well as Profits in April to June quarter of 2017-18 as compared to the same period last year – rest 4 companies fail to do so.
The Common Parameters for such Dismal Performance for the Sector
The current quarter was marked by industry wide destocking as customers in general adopted a cautious approach towards carrying inventories in run up to GST rollout, which impacted domestic sales volume.
Market Leader Performance:
Market leader TATA STEEL registered 39.36% growth in Revenues due to increased capacity in India and ongoing restructuring in Europe and 11.98% de-growth in Profits as compared to the same period last year.
Star Performer in the Sector:
The star performer in the sector for the quarter ended 30 June 2017 was Jindal Stainless (Hisar) where the company showed 50.47% increment in profit and 47.49% growth in Revenue as compared to the same period last year.
Here is the Data
Considering the overall demand situation and the outlook, it is expected that the steel prices to remain buoyant in the international market and in line with that domestic steel prices will fluctuate. Historically, the growth in demand in the 2nd half of the year is much better. The Indian Steel Industry is hoping to see the repeat of the same thing so the growth in demand for steel will be 5% or more.
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