Q4 Results: NMDC Expects Pricing Pressure In Odisha Sector To Hurt Margin
The company’s operating margin for the January-March period expanded 840 basis points year-on-year to 57.4%.
NMDC Ltd. expects its operating margin to get affected due to pricing pressure anticipated in the Odisha sector, according to its Director of Finance Amitabh Mukherjee.
“We are expecting that there could be a tremendous increase in production and, as a consequence, there could be severe pressures on prices from the Odisha sector,” Mukherjee told BloombergQuint, adding that if steel prices keep going up, the company may get insulated from pricing pressure.
NMDC’s operating margin for the January-March period expanded 840 basis points to 57.4 percent on a yearly basis. Net profit of India’s largest iron ore miner was up 31.5 percent year-on-year to Rs 1,453.8 crore for the quarter ended March.
The company took a price hike of Rs 250 per tonne last week based on steel prices moving up, Mukherjee said, adding that the status of Odisha auctions impacting prices will be clearer in the second half of this year. “India's steel production is growing at 7 percent while consumption is growing at 5 percent-plus which is a good sign for the industry.”
Other Highlights:
(YoY)
- Revenue down 6.2 percent to Rs 3,643.3 crore.
- Net profit up 31.5 percent to Rs 1,453.8 crore.
- Operating profit up 10.1 percent to Rs 2,092.3 crore.
- Sales volume stood flat at 10.4 MT.