Kolkata March 12: Tata Steel has posted a 34.21% increase in consolidated net profit at Rs 1,416 crore for the third quarter ended December 31, 2007 after the acquisition of Corus early last year.

The Tata Steel scrip today declined over 6% to Rs 766 on the BSE today as results were below market expectations. Trade analysts, however, expect better performance in the coming quarters led by price increases.

Excluding turnover of Tata Steel UK of Rs 23,867 crore for the quarter, turnover registered an increase of Rs 2,157 crore. The increase was mainly due to increases in Tata Steel's Indian operations driven by increase in prices. The increase in NatSteel and Tata Steel Thailand's operations were attributed to price rise and increase in volumes.

The material cost, excluding Tata Steel UK of Rs 11,253 crore, increased from Rs 1,919 crore to Rs 3,003 crore. While increase in volume of operations as well as increase in prices of inputs (scrap) consumed by NatSteel resulted in an increase of Rs 887 crore, Tata Steel Thailand contributed Rs 226 crore to increase on account of increase in volumes. Increase in NatSteel group was also due to increase in purchases of raw materials by TS Resources Australia for use by Tata Steel India.

The interest charges (net) were Rs 1,081 crore. Other than interest charge of Rs 606 crore of Tata Steel UK, remaining increase was mainly due to increase in borrowings to fund acquisition cost of Corus.

Due to rupee appreciation against major foreign currencies, the company had a net exchange gain of Rs 45 crore.

The actuarial gain on funds for employee benefits amounts to Rs 145 crore for the quarter ended December 31, 2007. The gain represents reduction in pension liability arising out of higher discount rate reflecting improved yields on bonds.