JSW Steel Q1 profit, revenue beat estimates on higher prices, strong demand

JSW Steel, India’s largest steelmaker by capacity, more than doubled its profit in the June quarter and beat analyst expectations, as higher steel prices and strong domestic demand boosted earnings.

Sajjan Jindal-led company reports consolidated net profit ₹4,651 crore in the first quarter of FY27. ₹2,184 crore in the previous year, according to a stock exchange filing on Friday. Profit exceeded the figure ₹The average estimate of seven analysts surveyed by Bloomberg is 3,199 crore.

Strong steel realizations and resilient domestic demand helped offset higher input costs in the quarter, which rose amid conflicts in West Asia.

Despite a strong quarter, the company said geopolitical tensions, particularly in West Asia, remain an important issue to watch.

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Jayant Acharya, joint managing director and chief executive officer (CEO) of JSW Steel, in a post-earnings interaction with analysts, said: “While the adverse impact of the conflict on supply side disruptions and rising energy costs started to fade by the end of June, the recent uptick and improvement remain key watchables. Looking ahead, restructuring-related demand may provide additional growth impetus.”

The Mumbai-based steelmaker reported a 10% year-on-year increase in consolidated revenue. ₹47,364 crore during April-June ₹45,109 crore consensus estimate from 23 analysts surveyed Bloomberg.

Acharya said volumes will increase in the September quarter as production increases at the Vijayanagar blast furnace 3 and Ohio, US operations. However, prices for these key raw materials are expected to ease only towards the end of the 2nd quarter and into the 3rd quarter, with any benefit to margins occurring during this period.

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Higher steel prices helped offset rising iron ore and coking coal costs in the June quarter, supporting revenue and EBITDA (earnings before interest, tax, depreciation and amortization) growth. Looking ahead, the September quarter is seasonally weak due to monsoon rains and revenues are likely to remain under pressure due to higher input costs and mild steel prices. However, Satyadeep Jain, metals and mining analyst at Ambit Capital, said increased volumes resulting from capacity additions are expected to partially cushion the impact.

Despite global geopolitical uncertainties, India’s growth momentum remains intact, supported by strong domestic demand and ongoing government-led infrastructure spending, JSW Steel said. Continuous demand is expected from sectors such as automobile, commercial real estate, energy, data centers, defense and maritime.

Earnings before interest, taxes, depreciation and amortization increased 23% annually in the first quarter. ₹9,383 crore.

According to Acharya, domestic steel demand is expected to grow at a healthy rate of 7% to 9%, which will lay a strong foundation for future capacity expansion. Demand is expected to be supported by public and private investment spending, manufacturing and the automotive sector.

Acharya also stated that due to the conflict in West Asia, cargoes originally intended for the region landed in India, increasing imports. Imports from countries such as Japan, with which India has a free trade agreement, also increased.

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“With the safeguard duty imposed on December 26, India became a net exporter of steel after two years in FY26. However, in the first quarter, India once again became a net importer of steel,” Acharya said, adding that imports increased by 22% compared to the previous quarter and exports fell by about 16%.

Last month, New Delhi launched an anti-dumping investigation into imports of hot-rolled flat steel products from China, Japan and Russia after major domestic producers alleged that low-priced imports were causing material damage to the local industry and threatening further damage.

Regarding expansion projects, the company said that the upgrade of blast furnace-3 at its Vijayanagar plant, which increased the capacity from 3 million tonnes per annum (mtpa) to 4.5 mtpa, was completed in June and the capacity has already increased to over 80%. Additional volume is expected from the September quarter onwards, the steelmaker said.

While the Dolvi Phase-III expansion in Maharashtra from 10 mtpa to 15 mtpa is on track to be completed by September 2027, the Utkal project in Odisha and the Kadapa electric arc furnace project in Andhra Pradesh are progressing as planned.

JSW Steel also confirmed its FY27 capital expenditure guidance. ₹22,000-24,000 crore. Made an investment expenditure ₹4,869 crore in the June quarter towards ongoing expansion projects, especially in Vijayanagar, Dolvi, Utkal and Kadapa.