what do canadians know, page-2

this released today, might be the driver for increase

$0.640 May 27, 2011, 11:48 AM EDT
Change: 0.140 (28.00%)Volume: 62,000


NMDC May Sign Pact With Severstal, Buy U.S. Mine Stake (Correct)
Share Business ExchangeTwitterFacebook| Email | Print | A A A
By Rajesh Kumar Singh and Abhishek Shanker

(Corrects stake amount in second paragraph.)

May 27 (Bloomberg) -- NMDC Ltd., India?s largest iron ore miner, expects to sign an accord with OAO Severstal, Russia?s largest steelmaker, NMDC Chairman Rana Som said.

Separately, the company plans to acquire a 50 percent stake in Minemakers Ltd.?s phosphate mine in Australia, and is close to buying a stake in a U.S. coking coal mine, Som told reporters today in New Delhi today. The company plans to spend 33 billion rupees ($730 million) in the year ending March 31, he said.

NMDC?s profit climbed to 21 billion rupees, or 5.29 rupees a share, in the three months ended March 31 from 10.7 billion rupees, or 2.69 rupees, a year earlier, the Hyderabad, India- based company said today in a statement to the Bombay Stock Exchange. The average profit estimate of seven analysts surveyed by Bloomberg was 20.8 billion rupees. Sales rose 90 percent to 37.7 billion rupees.

Rising demand for steel from automobile and construction companies is spurring demand for iron ore in India. The nation?s steel demand rose almost 10 percent in the last fiscal year as higher incomes lifted demand for cars and government spending pushed up sales to infrastructure companies.

NMDC, which sells about 85 percent of output in India, raised domestic prices by 74 percent to 3,366 rupees a metric ton in the last quarter from a year earlier. Cash iron ore prices at Tianjin port in China rose 36 percent on average in the period.

NMDC rose 2.3 percent to 258.4 rupees at the 3:30 p.m. close in Mumbai. The stock has declined 7.3 percent this year, compared with an 11 percent decline in the benchmark Sensitive Index of the Bombay Stock Exchange. The earnings were announced after the markets closed.

The company?s tax and royalty expenses in the last quarter more than doubled to 3.34 billion rupees from a year earlier, while other income rose 80 percent to 4.43 billion rupees, the statement said.

To contact the reporters on this story: Rajesh Kumar Singh in New Delhi at [email protected]; Abhishek Shanker in Mumbai at [email protected]

To contact the editor responsible for this story: Andrew Hobbs at [email protected]

Last Updated: May 27, 2011 10:24 EDT