JSW Steel Reports ₹2,773 Crore Profit in Q3, Exceeds Estimates

JSW Steel, a subsidiary of the JSW Group, has announced its second-quarter earnings. The company reported a consolidated profit of Rs 2,773 crore, marking a significant recovery from a consolidated net loss of Rs 848 crore in the same period last year. The September quarter results have surpassed street expectations.

JSW Steel achieved a 6.7% year-on-year increase in its consolidated net revenue for the second quarter, reaching Rs 44,584 crore compared to Rs 41,778 crore in the corresponding period of the previous year. The company's earnings before interest, taxes, depreciation, and amortization (EBITDA) reached Rs 7,886 crore, indicating a significant margin improvement. The operating margin expanded by a 1,350 basis point, rising from 4.2% a year ago to the current 17.7%.

JSW Steel attributed its strong financial performance to an 11% increase in total sales volumes on a quarter-on-quarter basis and a 10% rise on a year-on-year basis. This surge was primarily driven by robust domestic demand and the liquidation of 0.3 million tonnes of inventory during the quarter. However, the net sales realizations (NSR) for Indian operations declined by 4% both on a quarterly and yearly basis.

The company cited several factors that contributed to its positive performance. Indian operations benefited from lower coking coal prices and a slight decrease in iron ore costs every quarter. On a yearly basis, cost reduction was primarily attributed to the decrease in coking coal prices.

JSW Steel's subsidiary will acquire the remaining 10% stake in JSW USA from Green Suppliers and Services. This acquisition will result in JSW USA becoming a wholly-owned subsidiary of the company. The transaction, valued at $1,000, is expected to be completed before December 31, 2023.

Despite the positive financial results, JSW Steel's stock saw a 1.13% decline, settling at ₹771.65 compared to the previous closing price of ₹779 on the BSE. Over the past month, the stock has experienced a 1% loss, but it has gained 8.58% in the last six months.