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 India's state-owned Bharat Heavy Electricals reported a third-quarter loss on Tuesday, as higher material costs offset strong demand.

The power equipment manufacturer reported a net loss of 1.63 billion rupees (nearly $20 million) for the quarter ended Dec. 31, against a profit of 310 million rupees a year earlier.

BHEL had reported a fall in its quarterly profit in the fourth quarter of fiscal 2023 and has been reporting quarterly losses since then as it grapples with higher costs of key raw materials such as steel, copper and rubber.

Prices of all three were up year-on-year in every quarter in the calendar year 2023.

The company's total expenses rose 9% in the December quarter, amid a 19% rise in raw material costs.

This more than offset a 6.8% rise in its income from operations to 52.73 billion rupees.

Still, BHEL benefitted from rising electricity demand, as it has a nearly 57% share in India's coal-based power generation.

India's industrial output grew at its fastest pace in 16 months in October, with a 20.4% increase in electricity generation, official data showed. Industrial output rose 2.4% in November and 3.8% in December.

This resulted in a 2% rise in BHEL's power revenue and a 28% rise in its industrial revenue, its two biggest segments.

($1 = 83.0050 Indian rupees)