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Informist, Wednesday, Jul. 15, 2026

 

By Rajesh Gajra

 

MUMBAI – JSW Steel Ltd. is expected to report strong year-on-year growth in earnings for the June quarter on the back of higher steel prices, strong net sales realisation, and lower depreciation and finance costs, but would also see it reined in by higher coking coal and iron ore prices. The sales volume expectations are, however, bearish, since the company has already reported its consolidated production volume grew only 3% on year to 6.59 million tonnes.

 

JSW Steel is expected to report a consolidated net profit of INR 31.8 billion for the June quarter, up 46% on year, according to the average of estimates from 14 brokerages. The net profit estimates range from a high of INR 37.4 billion from Nuvama Wealth Management Ltd. to a low of INR 20.8 billion from PhillipCapital (India) Pvt. Ltd.

 

For the trailing quarter, the company had reported a consolidated net profit of INR 163.7 billion. However, excluding net exceptional gains of INR 178.9 billion, the company would have made a loss of INR 15.2 billion. The exceptional items included a gain of INR 180.5 billion from the sale of Bhushan Power and Steel Ltd.'s assets and a cost of INR 1.6 billion on account of the new labour codes.

 

The company's consolidated net sales for the June quarter are expected to be INR 444.7 billion, up 3.1% on year. The highest estimate for net sales is INR 486.7 billion from Nuvama and the lowest is INR 399.6 billion from Elara Securities (India) Pvt. Ltd. On quarter, net sales for the reporting quarter are expected to fall 13%.

 

JSW Steel is the largest steel manufacturer in the country with an installed domestic capacity of 31.9 million tonnes per annum, much higher than Tata Steel Ltd.'s domestic capacity of 27.4 million tonnes per annum. JSW Steel's consolidated installed capacity of 35.7 million tonnes per annum, which includes its factory in Ohio, the US, is almost the same as Tata Steel's consolidated capacity of 36 million tonnes per annum.

 

JSW Steel had reported 3% year-on-year growth in production volume for the June quarter after excluding the output of Bhushan Power and Steel. In March, JSW Steel transferred the steel business of its material subsidiary, Bhushan Power and Steel, which has an installed capacity of 4.5 million tonnes per annum, on a slump-sale basis to JSW-JFE Steel Ltd., a 50-50 joint venture company between JSW Steel and Japan's JFE Steel Corp. Being an associate company, this joint venture company's financials will not be reflected in the June quarter consolidated earnings of JSW Steel.

 

The low production volume growth of 3% was influenced by the lack of production in the company's blast furnace 3 unit till Jun. 22 due to a planned long shutdown for debottlenecking and capacity upgrade. The shutdown of this blast furnace had commenced in September. JSW Steel noted in its June quarter update that the production volume was aided by a full ramp-up of its wholly-owned subsidiary JSW Vijayanagar Metallics Ltd.'s operations and improved utilisation at its Dolvi factory in Maharashtra.

 

Nomura Equity Research expects the company's revenue for the reporting quarter to be helped by stronger realisations. Kotak expects the standalone realisation to increase 11% on year "on account of price hikes during the quarter".

 

JSW Steel and other large steel companies have benefited from higher domestic steel prices following the imposition of graded long-term safeguard duty, starting with 12% for the first year, by the government on Dec. 30. Domestic hot-rolled coil steel prices started moving up in the March quarter to around INR 58,200 per tonne after having touched a low of INR 45,850 per tonne in the December quarter.

 

For JSW Steel, a part of the price recovery in the March quarter was expected to be realised in the June quarter, Jayant Acharya, joint managing director and chief executive officer, had said in a conference call with analysts after the March quarter earnings. Acharya had said the company had increased prices of flat steel in April and early May and expected prices to be range-bound for the rest of the quarter.

 

The company's earnings before interest, tax, depreciation, and amortisation are expected to increase on the back of higher net sales realisation but are seen reined in by higher iron ore and coking coal costs. Acharya had indicated in the investor call that the company expects coking coal costs to increase by $12-$15 per tonne and iron ore prices to be up 5% sequentially for the June quarter.

 

The cost of materials consumed, which includes iron ore, was 40% of net sales for the March quarter. Power and fuel costs, which are driven primarily by the cost of coking coal, were 8% of net sales that quarter. Brokerage Ambit Capital Pvt. Ltd. said it expects the EBITDA per tonne to increase for JSW Steel for the reporting quarter but sees a contraction in the EBITDA margin.

 

The company will detail its June quarter earnings Friday. Investors will watch out for the management's commentary on the continuing impact on freight rates and supply of input materials from the US-Iran war. The outlook for domestic demand and progress in capital expenditure will be other factors of interest.

 

Wednesday, shares of JSW Steel closed at INR 1,226.90 on the National Stock Exchange, down 1.7% from Tuesday. The shares are down 5.4% from the date the March quarter earnings were announced. Of the 16 brokerage reports on JSW Steel available with Informist, eight have a "buy" call on the stock at an average target price of INR 1,443 per share, four have a "sell" call at an average target price of INR 1,136, and four have a "hold" recommendation.

 

Following are the June quarter earnings estimates for JSW Steel from 14 brokerages, in descending order of the net profit estimate, in INR billion:

 

Brokerage	Net Sales	Net Profit	EBITDA
Nuvama Wealth Management Ltd.	486.74	37.40	81.31
Motilal Oswal Financial Services Ltd.	431.20	37.30	92.90
Prabhudas Lilladher Pvt. Ltd.	477.30	35.80	86.20
Ambit Capital Pvt. Ltd.	420.94	34.66	83.90
Elara Securities (India) Pvt. Ltd.	399.57	34.38	83.66
Kotak Securities Ltd.	445.79	33.03	85.58
Nomura Equity Research	425.74	32.19	80.76
Systematix Shares and Stocks (India) Ltd.	470.70	31.60	83.00
Emkay Global Financial Services Ltd.	472.02	31.00	--
YES Securities (India) Ltd.	437.02	30.98	84.00
JM Financial Institutional Securities Pvt. Ltd	443.32	30.98	69.25
IDBI Capital Market Services Ltd	438.10	28.35	86.39
Anand Rathi Share and Stock Brokers Ltd	427.31	26.75	--
PhillipCapital (India) Pvt Ltd	450.13	20.75	73.13
Average	444.71	31.80	82.51

 

End

 

Edited by Shubhayan Bhattacharya

 

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