SAIL Reports 31% Profit Decline in Q2

8 Nov 2024 , 11:21 AM

Steel Authority of India Ltd (SAIL) reported a 31% drop in net profit for Q2 FY25, reaching ₹897.2 Crore, down from ₹1,305.6 Crore in the same quarter last year.

At the time of writing on November 8, 2024 shares of Steel Authority of India Ltd (SAIL) closed at ₹119.51 which is a 3.12% dip than the previous close. Steel Authority of India Ltd (SAIL) has gained a total of 39% in the last one year, and 4.16% dip since the beginning of the year.

Revenue for the quarter fell by 17% YoY to ₹24,675 Crore, compared to ₹29,712 Crore in the corresponding period of the previous year. EBITDA (earnings before interest, taxes, depreciation, and amortization) decreased by 24.8% YoY to ₹2,912.8 Crore from ₹3,875.4 Crore. The EBITDA margin also declined to 11.8% from 13% a year ago.

The decrease in profit was largely driven by a sharp decline in steel prices and weak demand. Indian steelmakers, including SAIL, have been facing challenges due to increasing low-cost imports from China, South Korea, and Vietnam, which contributed to a drop in domestic steel prices to a three-year low.

A decrease in iron ore and coking coal costs helped cushion the earnings impact despite the challenging market conditions. Competitors like JSW Steel reported higher-than-expected profits, while Tata Steel achieved strong results due to increased volumes in the Netherlands.