India: Godawari Power and Ispat Reports Increased Wire Rod Output in Q1 FY19

Godawari Power and Ispat Limited- one of the largest steel producers based in Central India has released its operational and financial performance for June quarter FY’19. Godawari Power is an end-to-end manufacturer of mild steel wires. In the process, the company manufactures sponge iron, billets, Ferro alloys, captive power, wires rods (through subsidiary company), steel wires, Oxygen gas, fly ash brick as well as pellets.

Key Operational performance highlights:

1) Steel Billet production up 14% Q-o-Q: Company’s Steel Billet production has increased by 28% to 60,280 MT in Q1 FY’19 on Y-o-Y basis and up 14% on Q-o-Q basis.

2) Wire Rods/TMT production : Company’s Wire rod/ TMT production has significant increased by 47% in Q1 FY’19 to 47,203 MT on Y-o-Y basis and up by 30% on Q-o-Q basis.

3) HB Wire: Company’s HB wire production has observed significant surge by 38% in Q1 FY’19 to 34,990 MT on Y-o-Y basis and up by 25% in Q-o-Q.

4) Iron ore production fell marginally on quarterly basis: Iron ore production from its captive mines stood at 0.41 MnT in Q1 FY19 , less by 5% Q-o-Q. However on Y-o-Y basis it has increased by 10%

5) Pellet Production moves down : Godawari Power produced 0.45 MnT pellets in Q1 FY19, less by 9% Q-o-Q and 2% Y-o-Y

Key Financial performance Highlights:

1) Sales from Operation : On a standalone basis, company has reported revenue from operation of INR 643.37 crore in Q1 FY19 which has seen slightly increased by 3% on Q-o-Q basis while it is up by 21% on Q-o-Q basis.

On consolidated basis, its sales revenue has also increased by 16% to INR 720.04 crore on Y-o-Y basis, however its sales has marginally fallen by 3% on Q-o-Q basis on account of fall in realisation of pellets in Ardent steel.

2) Net Profit: On a standalone basis, company has recorded net profit of INR 55.53 crore in Q1 FY19, increased sharply on Y-o-Y basis while it fall by 37% on Q-o-Q basis.

Ardent Steel performance review: During the quarter, Ardent Steel – a subsidiary of Godawari Power produced 92,481 MT of iron ore pellets & sold 1,03,333 MT of pellets in the market. The average realisation during Q1FY19 INR 4,988 as compared to realisation of INR 4184 in the corresponding quarter of last year and average realisation of INR 5307 in Q4FY18. The production during the quarter was lower on account of routine maintenance shut-down of the plant.

GPIL-Details of Production & Sales figure for Q1 FY’19:

Source: Company Website- SteelMint Research