JSW Steel reports 13-fold rise in profit in March quarter; Doubling capacity in 6 years

JSW Steel reported a nearly 13-fold rise in its consolidated net profit in the March quarter, driven by a one-time benefit from sluggish sales of BPSL Steel. The country’s largest steel maker has also guided to reach a production capacity of 78 million tonnes by FY32, up from around 36.4 million tonnes currently.

The two-fold increase in capacity will include the capacity of joint ventures – POSCO and JFE Steel.

The flagship company of JSW Group has a bottomline of Rs. 19,243 crore which last year was Rs. 1,510 crores. Apart from the exceptional benefit, it also had a one-time charge related to labor codes.

Adjusted for extraordinary items, the net profit was Rs. 3,475 crore, which is double the previous year.

In March quarter Rs. Sales volume of 7.97 million tonnes and Rs. 51,180 crore was witnessed by the highest revenue ever from operations. Reported earnings before interest, tax, depreciation and amortization for the quarter stood at Rs. 6,378 crore to Rs. 8,634 crore, while the EBITDA margin was 19%.

JSW Steel reported its earnings after market hours on Thursday, and its shares traded on the BSE at Rs. 1,297.05, about 2% higher than the previous close.

Growth Strategy
JSW Steel currently has a steel production capacity of around 31.9 million tonnes at stand-alone level, which is expected to increase to 48.8 million tonnes by FY 2030 and then 62 million tonnes by FY 2032.

Including 4.5 million tonnes of capacity from its joint venture with JFE Steel, the company currently has a capacity of 36.4 million tonnes, which will increase to 53.3 million tonnes by FY2030. Including its capacity from the joint venture with South Korean steel company Posco, the company’s capacity will be 732.2 million tonnes.

“JSW Steel’s growth has been firmly India-centric, reflecting our long-term confidence in India’s growth trajectory,” the company said in a statement. “A strong domestic steel ecosystem directly contributes to self-sufficiency, while also creating an opportunity to build greater resilience as a country, particularly in enhancing our energy security in an increasingly uncertain global environment,” he said.

JSW Steel in the current financial year on capital expenditure of Rs. 22,000-24,000 crore has been guided to be spent, which is Rs. 15,595 crore is over.

The company has also announced capacity expansion of another 5 million tonnes by FY 2030 at its Vijayanagar plant at a capital expenditure of Rs 26,000 crore. This will make it the world’s largest single plant with a capacity of 25 million tonnes.