BENGALURU - India's Jindal Steel and Power reported a 15% drop in first-quarter profit on Friday, hurt by the rise in expenses and fall in steel prices.

The New Delhi-based company's consolidated profit after tax fell to 16.92 billion rupees ($204.31 million) in the three months ended June 30 from 19.90 billion rupees a year earlier.

While domestic demand has been rising for Indian metals companies, subdued demand from top consumer China remained a drag on prices, analysts said.

Jindal Steel, which has an annual crude steel production capacity of 9.6 million metric tons per annum, said overall sales grew 6% year-on-year. The share of exports stood at 10%.

India's steel industry, grappling with a slump in prices, was further hit when an export tax on certain steel intermediaries in May last year. The tax was withdrawn later in November.

However, the export duty resulted in a 55% fall in India's steel exports in fiscal 2023, the company said.

Gross revenue dropped 1.5% to 145.39 billion rupees, down for the fourth straight quarter, while total expenses rose nearly 3%.

As part of plans to reduce reliance on third-party suppliers, Jindal Steel said it has secured three new non-coking coal mines in FY 2022-23, which will likely commence operations in FY 2023-24.

It further said domestic demand for steel is expected to witness an annual expansion of 8-9 MT in the next two financial years.

Bigger rivals, JSW Steel's first-quarter profit nearly tripled on higher sales, while Tata Steel posted a 92% slump in profit, hurt by the lower prices of alloy and expenses related to a pension scheme in Britain.

Shares of Jindal Steel closed 3.23% higher at 698.20 rupees ahead of the results.

($1 = 82.8170 Indian rupees)

(Reporting by Ashish Chandra in Bengaluru; Editing by Sohini Goswami)