India's Tata Steel reported its first profit in five quarters, beating analyst expectations for its fourth quarter.
The steel giant said it had a consolidated net profit of 2.32bn rupees (£27.8m) for the three months to 31 December compared with a loss of 27.48bn rupees the previous year. Analysts were estimating 1.74bn rupees according to Reuters.
Revenue increased 14 per cent to 293.92bn rupees driven by strong performance from its Indian operations.
Deliveries in India grew 27 per cent year on year, outperforming domestic markets which fell by two per cent. Automotive sales in the country increased by 20 per cent, while industrial products, projects and exports were up 47 per cent year on year. Branded products rose 13 per cent on the previous year despite the impact of demonetisation.
Why its interesting
Higher sales of industrial products and steel and a rise in exports despite India's surprise ban on high-value currency notes helped Tata beat expectations today.
Prime Minister Narendra Modi's banned old 500 and 1000 rupee bills late last year, which hurt business across the country.
Tata Steel's UK subsidiary has reached an agreement with trade unions to progress towards closing a pension scheme. Koushik Chatterjee, group executive director, said this continues to be an "important priority" for the company.
Tata also said its UK arm will negotiate with Liberty House Group for the potential sale of its speciality steels business for an enterprise value of £100m, the statement said.
What Tata Steel said
T.V. Narendran, managing director of Tata Steel India and South East Asia said: "Tata Steel recorded strong sales this quarter as the strength of our franchise helped us counter headwinds due to de-monetisation.
"Further, our focus on cost improvement initiatives and our integrated operations helped us to contain the impact of rising raw material prices," he added.
Koushik Chatterjee, group executive director, said: "The financial performance reflects strong underlying operating performance across the group in spite of a seasonally slow quarter in Europe."