JSW Steel's June-quarter profit more than doubled, aided by higher other income and record first-quarter steel sales, helping the company beat Street estimates across key metrics. The board also approved selling shares worth up to ₹811 crore in the proposed IPO of JSW One Platforms.
By Sheersh Kapoor
JSW Steel Ltd reported a stronger-than-expected performance for the June quarter, beating CNBC-TV18 estimates across all key financial metrics as higher steel realisations, robust sales and improved operating efficiencies drove a sharp rise in profitability.
The steelmaker posted a consolidated net profit of ₹4,696 crore for the quarter, more than doubling from ₹2,209 crore a year ago and comfortably ahead of the CNBC-TV18 poll estimate of ₹3,550 crore.
Revenue from operations increased 9.8% year-on-year to ₹47,364 crore, surpassing analysts' expectations of ₹46,819 crore, while EBITDA rose 24% to ₹9,383 crore, compared with the poll estimate of ₹8,398 crore.
Operating performance also improved meaningfully, with the EBITDA margin expanding to 19.81% from 17.56% a year earlier, beating the Street expectation of 17.94%. Other income nearly doubled to ₹724 crore, compared with ₹350 crore in the corresponding quarter last year.
Operationally, the company produced 6.59 million tonnes of crude steel during the quarter, up 3% year-on-year and 2% sequentially. Excluding the temporary shutdown of Blast Furnace-3 for an upgrade in the year-ago period, production growth stood at 15%.
Steel sales reached a record 6.25 million tonnes for any first quarter, rising 4% year-on-year, led by continued strength in value-added and special products (VASP) and flat steel. Sales to institutional customers, the automobile sector, renewable energy and appliances were the highest ever for a June quarter. Domestic sales stood at 5.34 million tonnes, while institutional sales increased 5% from a year earlier.
The company also strengthened its balance sheet during the quarter. Net debt declined by ₹7,713 crore from March-end to ₹46,157 crore, helping improve its net debt-to-equity ratio to 0.42x from 0.51x in the previous quarter. Net debt-to-EBITDA also improved to 1.46x, compared with 1.81x at the end of March.
Separately, the board approved the company's participation in the proposed initial public offering (IPO) of JSW One Platforms Ltd.
As part of the offering, JSW Steel plans to sell shares worth up to ₹811 crore through an offer for sale (OFS), subject to regulatory approvals and market conditions. The proposed transaction is aimed at partially monetising its investment in the digital B2B commerce platform while continuing to remain a shareholder.
Following the earnings announcement, JSW Steel shares climbed more than 2% to an intraday high of ₹1,242.60 on the NSE, as investors cheered the earnings beat and continued improvement in the company's operating performance and leverage profile.
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