JSW Steel Ltd., India’s third-biggest producer of the alloy, swung to a quarterly loss as cheap imports from China and a decline in domestic demand trimmed margins.
The net loss was 1.07 billion rupees ($17 million) in the first quarter ended June 30, compared with a profit of 6.56 billion rupees a year earlier, the company said Wednesday in a statement. That compares with the 982.5 million-rupee median loss of 16 analyst estimates compiled by Bloomberg. Net sales fell 13 percent to 113.8 billion rupees.
The global steel industry is reeling under the impact of exports from China, Sajjan Jindal, chairman of JSW Steel, said on Tuesday. Steel companies in Asia’s third-biggest economy face challenges from an unprecedented surge in imports, domestic constraints on the supply of iron ore, and sluggish demand, he told shareholders.
Steel exports from China have increased to extraordinary levels as demand in the world’s largest producer slows, Credit Suisse Group AG said on July 27. Overseas sales from China rose to 52.4 million metric tons in the first half, it said, a level on par with Japan’s total production.
Shares of JSW Steel rose 0.4 percent to 813.05 rupees at the close in Mumbai on Wednesday. The stock has declined 22 percent this year, heading for the first annual decline in four years.