JSW Steel Ltd, India’s third- biggest producer, returned to profit in the second quarter after increasing production and benefiting from a one-time foreign exchange gain.

Group net income was Rs.691 crore ($128.5 million) in the three months ended 30 September, compared with a Rs.669 crore loss a year earlier, the Mumbai-based company said on Sunday in a statement. The median estimate of 28 analysts surveyed by Bloomberg was for a profit of Rs.462 crore. Sales climbed 17% to Rs.9,475 crore.

Production at JSW’s biggest factory, in Karnataka, rose 25% in the quarter to 2.17 million metric tonnes from a year earlier after it secured iron ore supplies from government auctions of the raw material. The nation’s top court, which banned mining in the southern Indian state in August last year pending investigations into violations of environmental norms, allowed limited sales of iron ore to steel makers in the state.

Earnings were boosted by a foreign-exchange gain of Rs.424 crore. JSW incurred a forex loss of Rs.486 crore in the second quarter last year.

Total costs at JSW, in which Japan’s second-biggest steel maker JFE Holdings Inc. holds a 15% stake, increased 18% to Rs.8,529 crore in the quarter, according to the statement. Tax expenses rose more than fivefold to Rs.336 crore.

The company benefited from lower costs of coking coal, another key steel making ingredient, last quarter. Quarterly contract prices of coal fell 25% to $225 a tonne in the three months ended 30 September, faster than a 19% increase in prices of global benchmark hot-rolled coils used to make flat steel.

JSW shares gained 0.3% to Rs.733.15 in Mumbai on 26 October. The stock has rallied 45% this year, compared with a 21% advance in the benchmark BSE India Sensitive Index, or Sensex.