India's largest coke producer, Gujarat NRE Coke, expects demand for the raw material to bounce back in coming few months despite reporting a 74 per cent decline in net profit for the quarter-ended December 31.
The company said its net profit has declined 73.46 per cent to Rs 13.26 crore [Rs132.6 million], for the third quarter of the fiscal year 2008-09. The company had reported a net profit of Rs 49.97 crore [Rs499.7 million] in the same period a year ago.
" Every customer stopped buying during this phase of industrial downturn but consummation from their stock continued. As soon as the stock dries out, the demand will resurface again," Gujarat NRE Coke Vice-Chairman and Managing Director Arun K Jagatramka told media.
The company said it had also lowered prices of its products in order to maintain sales during the slowdown. "When we saw demand vanishing we lowered met coke prices to maintain our sales. Our thrust was to concentrate on volume, if volume grows sales grows," he added.
The company's total income rose to Rs 439.32 crore [Rs4393.2 million] for the quarter under review, against Rs 252.57 crore [Rs2525.7 million] for the same period a year ago. For the nine months ended December 31, the company posted a net profit of Rs 210.41 crore [Rs 2104.1 million], up 98 per cent from Rs 106.34 crore [Rs1063.4 million] for the same period last fiscal year.
The company owns two coking coal mines in Australia which at present produces about a million tonnes of the mineral annually and the company expects them to reach the seven million tonne mark in the next three to four years.
The firm's coke output stands at a million tonne and is likely to touch 1.25 million tonne by March 31, 2009. Undeterred by the downturn, the company said its multi- billion dollar projects in India and overseas will go on as scheduled.
Source: Indopia
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