India: Godawari Power and Ispat Pellet Production Up 7% in Q1 FY'20

Godawari Power and Ispat Limited (GPIL) - one of the largest steel producers based in central India has released its operational results for the first quarter of FY'20 ending Jun'19.

Key operational performance highlights in Q1 FY20-:

1) Pellet production up 7% Y-o-Y: Company has produced 4,76,700 MT pellets in Q1 FY20, up 7% compared to same time frame last year at 4,45,900 MT. However, on quarterly basis company pellet production moved down by 12% against 5,40,000 MT at Q4 FY19. Pellet production from its ASL stood at 1,32,905 MT in Q1 FY20.

2) Pellet sales fall - Company sold 325,823 MT pellets in Q1 FY20, down 7.5% compared to same time frame last year at 3,52,348 MT. However, on quarterly basis company pellet sales moved down by 19% against 4,01,771 MT at Q4 FY19. Pellet sales from its ASL stood at MT in Q1 FY20.

3) Captive iron ore production up 3% in Q1 FY'20: Iron ore production from its captive mines stood at 4,48,914 MT in Q1 FY20 up by 3% as compared to last quarter at 4,36,053 MT. On yearly basis, iron ore production has been increased by 7% against 4,17,764 MT in the same quarter last fiscal year.

4) Steel billet production down 15% Q-o-Q: Company's Steel Billet production has decreased to 76,465 MT in Q1 FY'20, down 15% compared to last quarter at 90,390MT. However, on yearly basis, the company has increased production by 27% against 60,280 MT in Q1 FY19.

5) MS Rounds: Company's MS Rounds production was 46,914 MT in Q1FY'20, up 9% compared to 42,935 MT is last quarter ending Mar'19. On yearly basis, the company production declined marginally against Q1 FY19 at 47,203 MT.

6) HB Wire Production: Company's HB wire production in the quarter ending Jun'19 was up 3% to 33,052 MT compared to 32,062 MT is last quarter ending Mar'19. On yearly basis the company production down by 6% against Q1 FY19 at 34,990 MT.

Business Strategy for next quarter-:

Further value addition on steel billet through the manufacture of rolled product by commissioning the new rolling mill by Q2 FY20 of 200,000 MT. Expected savings of INR 1,000/MT on incremental production of rolled products.

New product addition for the manufacture of fabricated galvanized which lead to further improve in operating profitability.

100% captive utilization of sponge iron for increased production of steel billet.

GPIL is an end-to-end manufacturer of mild steel wires. In the process, the company manufactures iron ore, Sponge Iron, Billets, Ferro alloys, captive power, Wire rods (through subsidiary company), Steel wires, Oxygen gas, fly ash brick as well as pellets.