Other income during the three-month period shot up to Rs 125.9 crore from Rs31.67 crore. The increased amount shows the net income from sale of thecement division to Lafarge, which became effective from November 1.

Senior Tata Steel officials said of the total consideration of Rs 550 crore,around Rs 200 crore were used to retire debt which will lead to annualsavings of around Rs 24 crore. The the first nine months, net profit hasmore than doubled to Rs 236.36 crore against Rs 112.53 crore, while netsales have risen to Rs 4,833.73 crore as compared with Rs 4,413.51 crore inthe same period last year.

Realisation from the core steel business remained almost stagnant, while thenon-core ferro-chrome and tubes divisions still posted losses. The bearingsdivision fared marginally better than the previous quarters, companyofficials said.

Production in the third quarter at 7.84 lakhs was lower at 8.07 lakhs in thesame period last year, but sale was higher at 7.79 lakh as compared with7.73 lakh.

The steel business is expected to fare better in the fourth quarterfollowing the hike in prices, company officials said. Domestic prices havebeen raised twice, in November and in January, as an after-effect of a closeto 40 per cent jump in international steel prices. Exports to thetraditional markets are also expected to increase.

In the third quarter, the net interest outgo rose marginally to Rs 81.67crore from Rs 79.87 crore in the same period last year. Depreciation chargeswere also higher at Rs 108.25 crore against Rs 96 crore.

The outgo on account of the employee separation scheme (ESS) was marginallylower at Rs 42.29 crore as compared with Rs 45.48 crore in the third quarterlast year. For the nine months, the outgo has been lower at Rs 106.82 croreagainst Rs 123.56 crore in the same period of 1998-99.

Provision for taxation was higher at Rs 19 crore against Rs 3.14 crore inthe third quarter. For the nine months, tax outgo was double at Rs 30 croreas compared with Rs 15 crore in the same period last year.

INSIGHT :
Better operational show
Other income aside Tisco has reported a better operational performance. Thisis in spite of lower production during the third quarter of the currentfiscal as compared to the previous year. Better price realisation hasresulted in operating margins improving from 13.1 per cent to 16 per cent.Retirement of debt worth around Rs 200 crore from the proceeds of sale ofcement division and higher prices of steel is expected to help the company'sfourth quarter performance.

-- Shishir Asthana