Costly coal will continue to hurt margin: Tata Metaliks
Tata Metaliks reported a weak set of earnings for the September-ended quarter, as higher input costs dented the performance.
Sandeep Kumar, managing director (MD) of Tata Metaliks, on Tuesday, said that the high cost of coal will continue to put pressure on the company's margin.
The company reported a weak set of earnings for the September-ended quarter, as higher input costs dented the performance. Operating profit has slipped and margin has also contracted quite significantly.
“Iron ore prices, having come down, would give us some relief in the coming quarters. However, coal has moved up and that would impact the cost,” Kumar said in an interview to CNBC-TV18.
On business, he said, “Margins have been impacted because of input cost prices going in even though we have had an increase in prices of the pig iron business, the ductile iron pipe business takes a bit of a time; it’s more stable and we have had an order book of more than 12-14 months. So the impact of that would start coming in after a couple of quarters.”
“The first phase of expansion project should come on stream by end of Q4 and the second phase would take another 9-10 months after that. As far as capex is concerned, in Q2 we had a busy capex season; we have procured and invested a large part of it, more than Rs 80 crore of capex in Q2. In Q3 the capex is going to be even higher. So we have put this expansion on fast-track and by Q4 we should have commissioned the first phase which will double our capacity,” said Kumar.
For the entire management interview, watch the video
(Edited by : Bivekananda Biswas)
First Published: Oct 12, 2021 1:18 PM IST
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