JSW Steel Has Good Prospects on Lower Costs But Stock Fully Valued

For the April-June quarter of 2025-26 (Q1FY26), JSW Steel reported consolidated revenue of 43,200 crore flat year-on-year (Y-o-Y) and down 4 per cent quarter-on-quarter (Q-o-Q)), with good net sales realisations (NSR) offset by weak Q-o-Q volume growth.

- Devangshu Datta

Steel volumes stood at 6.69 million tonnes (mt) (up 9 per cent Y-o-Y and down 11 per cent Q-o-Q), due to planned shutdowns, while average sale price (ASP) was 64,500 per tonnes (down 8 per cent Y-o-Y and up 8 per cent Q-o-Q), indicating recent price recovery.

Earnings before interest, taxes, depreciation, and amortisation (Ebitda) was at 7,580 crore, an increase of 38 per cent Y-o-Y and up 19 per cent Q-oQ. Ebitda per tonne was 11,324 in Q1FY26, up 26 per cent Y-o-Y and 33 per cent Q-o-Q, due to better NSR and lower coal costs. Adjusted profit after tax (PAT) at 2,180 crore was up 159 per cent Y-o-Y and up 43 per cent Q-o-Q.

Consolidated crude steel production was 7.26 mt, up 14 per cent Y-o-Y and down 5 per cent Q-o-Q. Domestic capacity utilisation was 87 per cent vs 93 per cent in Q4FY25. Domestic sales was 5.96 mt, marking a 12 per cent Y-oY increase, while exports fell 20 per cent Y-o-Y.

In Q1FY26, blended steel prices increased ₹3,300 per tonne on a Q-o-Q basis, in line with guidance. Steel prices softened in June and the trend continued in July, due to weak global macros, cheaper imports and seasonal factors.