Uttam Galva Steels, a prominent manufacturer of cold-rolled and galvanized steel in western India, has announced a widening net loss of ₹530.72 crore for the December quarter of 2018. This marks a dramatic increase from the net loss of ₹179.96 crore reported during the same period in 2017. The company's latest filing on the Bombay Stock Exchange indicates that rising finance costs and a significant drop in total income have contributed to these troubling figures.
Total income for the quarter plummeted to ₹100.05 crore, a stark decline from ₹680.48 crore in the previous year’s corresponding quarter. This drop underscores the challenges facing the steel manufacturer, which has struggled to maintain profitability in a volatile market. The substantial decrease in revenue raises concerns about the company's operational efficiency and market demand for its products.
One of the key factors behind Uttam Galva Steels' widening loss is its soaring finance costs, which skyrocketed to ₹291.93 crore during the period under review. This figure marks a dramatic increase from ₹121.31 crore in the December quarter of 2017. Such high finance costs are particularly alarming as they eat into the company’s profits, making it difficult for Uttam Galva Steels to recover from its financial setbacks.
Uttam Galva Steels operates by procuring hot-rolled steel and processing it into cold-rolled steel and further into galvanized steel and color-coated coils. The company's focus on these specialized products positions it as one of the largest steel manufacturers in its region. However, the steep rise in finance costs and dwindling revenue may hinder its ability to compete effectively in the market.
