Online edition of India's National Newspaper
Friday, Jan 28, 2005

About Us
Contact Us
Business
News: Front Page | National | Tamil Nadu | Andhra Pradesh | Karnataka | Kerala | New Delhi | Other States | International | Opinion | Business | Sport | Miscellaneous | Engagements |
Advts:
Classifieds | Employment | Obituary |

Business Printer Friendly Page   Send this Article to a Friend

SAIL net leaps, returns to dividend list

By Our Special Correspondent



V. S. Jain, Chairman, SAIL. — Photo: Kamal Narang.

NEW DELHI, JAN. 27. The Steel Authority of India Ltd (SAIL) today announced a 15 per cent interim dividend after a gap of seven years. The company reported a jump in net profit at Rs. 1,514 crores in the quarter ended December 2004 against Rs. 738 crores in the same period in the previous fiscal. The Centre would get Rs. 531.70 crores of the total dividend outgo of Rs. 619.56 crores.

"There is no pressure from the Government to declare dividend. But when the company is performing well, every stakeholder has a desire for returns," the SAIL Chairman, V. S. Jain told reporters following the board meeting.

Mr. Jain also announced massive investment plans of Rs. 25,000 crores till 2011-12 to increase the hot metal capacity to 20 million tonnes from the current 12.5 million tonnes. The board also approved the investment plans.

On funding, Mr. Jain said that finance would not be a problem. The company had decided to maintain the debt-equity ratio of 1:1. Also SAIL should be generated internal accruals in the range of Rs. 2,000 crores to Rs. 2,500 crores. As such market borrowing would not be necessary at least in the near future and "we may not require market borrowing at all.'' The net profit in the first nine months was Rs. 4,149 crores against Rs. 1,498 crores in the same period in the previous fiscal. The company reported a turnover of Rs. 21,558 crores during the nine month period as compared to Rs. 16,934 crores.

Mr. Jain, however, expressed concern over availability as well as prices of coking coal.

SAIL, which imports nine million tonnes of coking coal every year besides four million tonnes of coal procured domestically, had initiated a process to acquire mines abroad or enter into a strategic tie-up with a multinational mining company to secure long term supply of coking coal in line with its expansion plan. It was also talking to the Chhattisgarh Government to take over some mines.

About the future trend in steel prices and demand, Mr. Jain said, "We hope prices will remain firm in line with the international trend. Demand is also likely to remain buoyant not only because of China but also from other markets like Europe and the U.S.''

In the context of the merger of its subsidiary IISCO, Mr. Jain said that a proposal had already been sent to the Steel Ministry. SAIL was expecting a nod once some concerns such as extension of mining lease are addressed, he said adding that the investment plan of Rs. 340 crores, worked out by SAIL to revive IISCO, might also undergo a change after the merger of the two entities.

Observing that IISCO had also turned around and was making profit, Mr. Jain said that all SAIL subsidiaries except Alloy Steel Plant (ASP) had been making profits. Incidentally, ASP's losses had also come down substantially to Rs. 10 crores during the third quarter of 2004-05, he said.

Printer friendly page  
Send this article to Friends by E-Mail

Business

News: Front Page | National | Tamil Nadu | Andhra Pradesh | Karnataka | Kerala | New Delhi | Other States | International | Opinion | Business | Sport | Miscellaneous | Engagements |
Advts:
Classifieds | Employment | Obituary | Updates: Breaking News |


News Update


The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2005, The Hindu. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu