Tata Steel (Thailand) or TSTH, a unit of India's biggest steelmaker, expects a better performance in the fourth quarter as the domestic steel industry returns to the status quo after temporary duties on Chinese imports.
Peeyush Gupta, the president and chief executive, said overall TSTH predicts an increase in demand and the price of steel in the next quarter even if economic growth slows.
"Sometimes, GDP is not indicative of steel demand," he said.
In the first half of this year, Thai steel saw growth of 19%, while imports grew by 29%.
The duties put into effect on high-carbon steel since Aug 8 and lasting four months should help to level the playing field for domestic producers, after which time the measure will be re-evaluated for effectiveness.
Mr Gupta said the effects of the duties on imported steel will begin to show in the company's September earnings. But many uncertainties remain including approval of the 2014 budget bill and 2.2 trillion baht in infrastructure projects.
TSTH has maintained a sales growth target of 10% since the last fiscal year ended March 31, and a full-year projection will be available next quarter.
In the three months to June, TSTH posted a net loss of 111 million baht compared with a net loss of 200 million in the same period last year, on net sales of 5.95 billion from the sale of 306,000 tonnes.
The firm intends to close the deficit by focusing on products in demand from construction projects in Thailand, controlling costs by reducing imports of scrap and tightly managing working capital to reduce inventory.
Shares of TSTH closed unchanged yesterday on the Stock Exchange of Thailand at 71 satang, in trade worth 1.28 million baht.