A sharp jump in quarterly consolidated net profit and challenges from a tight raw material position were the key areas of Tata Steel chairman Ratan Tata’s address to shareholders at the company’s 101st annual general meeting (AGM), which was marked by fear of protests by environmentalists.

The Mumbai-based steel company, which is now the world’s fifth largest by capacity after the acquisition of Corus, said its consolidated net profit for the April-June period surged 60%, mainly as Corus was able to raise product prices unlike parent Tata Steel that has been bound by an assurance to the government to maintain prices. Tata Steel, along with other primary steel makers, had agreed to maintain prices for three months through to May, to help the government control inflation. On Thursday, the government said inflation had moderated to 12.40% from 12.63%.

Consolidated net profit for the first quarter, after minority interest, totalled Rs 3,900.90 crore, compared to Rs 2,431.50 crore. Sales in the same period grew 39% to Rs 43,560 crore.

“It is difficult to tell how (steel) prices will move as raw materials will put a pressure on margins,” Mr Tata said in response to a shareholder’s query. “As we move forward, we’ll be able to tell how the prices will function. Also, the health of the economy will say how much (raw material hikes) will be passed on.”

While steel companies haven’t yet indicated any move to raise prices, the gap between Indian and international prices — overseas steel products are costlier by an average Rs 15,000 per tonne — and rising ore and coke rates could force companies to revise September prices upward.

But international steel prices are beginning to feel the impact of a global slowdown led by recessionary trends in the US and a cut down in expenditure in China, post the Olympics. Iron ore prices have surged 85% in the past year, while coking coal rates have grown two fold in the same period, Mr Tata said.

The 101st AGM of Tata Steel saw record turnout from shareholders and the general public alike even as company executives fretted about a possible protest by environmental activists. The company has been the target of a series of innovative protests in the past month; a forged statement on suspension of work on a port project, a leaked footage of a plant accident at Corus last year and sit-ins by Greenpeace activists have worried company officials.

Mr Tata said that Tata steel is taking steps to secure raw materials such as iron ore and coal for Corus as the UK subsidiary buys its entire mineral requirements from the market. Also, as Tata Steel is also expanding capacity at Jamshedpur and setting up a greenfield plant at Orissa and Chhattisgarh, it will need additional raw material assets. The consolidated financials didn’t enthuse Tata Steel’s stock, as the company’s shares fell 1.6% to Rs 571.95, the lowest among Sensex stocks.