Tata Steel Ltd's quarterly net profit more than doubled, but still came in well below market expectations, hurt by rising expenses and a one-off charge.
India's biggest steel producer by assets said it took a one-time charge of 3.44 billion rupees on a consolidated basis. The bulk of this came from an exceptional charge of 3.35 billion rupees at its Indian business, mainly due to a provision made for additional interest on differential royalty paid on coal.
Net profit was 19.34 billion rupees ($276 million) in the three months to the end of June, compared to a profit of 9.21 billion rupees a year earlier. That compared with the analyst estimate of a profit of 26.44 billion rupees, according to Thomson Reuters I/B/E/S.
Tata recently agreed a joint venture with Germany's Thyssenkrupp creating Europe's number two steelmaker, after two years of negotiations, hoping it would help them respond to a volatile steel industry.
Steel deliveries rose over 12 percent to 6.55 million tonnes, while Tata Steel India posted a rise of about 7.9 percent in total steel deliveries for the quarter.
Tata Steel said total revenue from operations rose 22.1 percent to 378.33 billion rupees, while total expenses rose about 21 percent.
Tata Steel which picked up a controlling stake in debt-laden Bhushan Steel Ltd to increase its capacity in India, said it has launched a program to boost synergies with Bhushan.
Bhushan Steel, which was among a dozen companies pushed to bankruptcy court last year amid a government drive to clear a mountain of bad loans choking credit at Indian banks, has an annual steel making capacity of about 5.6 million tonnes.
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