JSW Steel little changed despite unfavourable ruling against subsidiary
2 December 2015
Shares of JSW Steel were little changed in Wednesday's trade after the steelmaker in a regulatory filing said a district court in the US has ruled against the company's subsidiary, JSW Steel USA, in a case pertaining to charges of antitrust conspiracy and slapped a fine of Rs 1,040 crore.
"JSW Steel USA has been contesting an appeal in the United States Court of Appeals for the fifth circuit. It is learnt that the decision has been pronounced by the US court against our subsidiary," JSW Steel told BSE.
"JSW Steel USA is disappointed with the decision by the US court and respectfully disagrees with its conclusions. The company is studying and analysing the judgment in detail and evaluating all options available to defend its position under the applicable laws," the company said.
On Tuesday, the stock traded sideways in early trade. It inched down 0.45 per cent to hit a low of Rs 939.10. The stock is down 21 per cent from its 52-week high of Rs 1,188.65 hit on the year-ago date.
A distributor in the US, MM Steel, had sued its competing distributors and steel manufacturers, including JSW Steel, in 2012, claiming that its rivals had conspired to deprive it of supplies and that the manufacturers had knowingly joined the plot. The company shut its business in 2013,, an Economic Times report said.
The company, like other steelmakers, is already seeing stiff competition from Korea, Japan and China in the domestic market.
Steel imports grew 42 per cent YoY in the first half of FY16, while consumption of domestically produced steel fell 2.3 per cent during the same period, the company said in its recent earnings note. The company has reported a profit of Rs 116.95 crore for the second quarter compared with a loss of Rs 106.81 crore reported for the previous three-month period.