JSW Steel reported a sharp 85% decline in consolidated net profit to Rs 404 crore for the quarter ending September 30, 2024, as domestic steel prices dropped to three-year lows due to increased imports of low-cost finished steel.
This is a significant fall from the Rs 2,773 crore profit reported in the same quarter last year. Additionally, the profit reduction was impacted by a one-time charge related to the surrender of the Jajang iron ore mine in Keonjhar, Odisha, with the company recognizing a Rs 342 crore provision for liabilities and site restoration.
Revenue from operations decreased by 11% to Rs 39,684 crore compared to Rs 44,584 crore in Q2 FY24. JSW Steel attributed this to a notable decline in steel realisations amid intense import pressure. Operating EBITDA stood at Rs 5,437 crore, showing a slight sequential decrease, though lower input costs partially offset the impact of imports.
The EBITDA margin for the quarter was 13.7%, down from 17.7% a year earlier and slightly higher than the 12.8% seen in the previous quarter. The results come as India’s domestic HRC prices have dropped 39% from their peak in April 2022, as noted in a recent Nomura report.
Despite strong domestic demand, especially in the automotive and construction sectors, weaker price realisations are expected to continue putting pressure on margins for major steel producers. The monsoon season traditionally weakens demand for steel, and this year the situation was further challenged by a surge in lower-cost Chinese imports. However, steel companies anticipate a possible reprieve from import pressures as China introduces new economic stimulus measures.
JSW Steel is one of India’s largest and most prominent steel producers, renowned for its cutting-edge technology and diverse product portfolio. Headquartered in Mumbai, JSW Steel is a part of the larger JSW Group and plays a critical role in India’s infrastructure development, supplying high-quality steel products for industries such as construction, automotive, energy, and manufacturing.
With an integrated production capacity that spans several manufacturing plants across India, JSW Steel is known for its innovation, focusing on producing environmentally sustainable and high-performance steel solutions. The company is also expanding its global footprint with operations in the U.S., Europe, and Africa, reinforcing its position as a key player in the international steel market.
JSW Steel’s commitment to sustainability is reflected in its investments in green steel, energy efficiency, and the circular economy, aligning its growth with environmental responsibility. Through continuous improvement and innovation, JSW Steel remains a driving force in both India’s industrial growth and the global steel industry.
