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JSW Steel Reports Robust Performance Amidst Global Challenges

JSW Steel Ltd, led by Sajjan Jindal, reported a significant turnaround in its financial performance for the September quarter. The company recorded a net profit of ₹2,773 crore, a remarkable improvement from the net loss in the same quarter last year. JSW Steel’s consolidated revenue from operations also saw a notable year-on-year increase of 6.71%, reaching ₹44,584 crore.

In terms of earnings, the company’s consolidated EBITDA (earnings before interest, taxes, depreciation, and amortization) amounted to ₹7,886 crore, with an EBITDA margin of 17.7%.

The company attributed this strong growth to the government’s focus on infrastructure development and positive consumer sentiment, which have been driving investments. India’s emphasis on infrastructure, energy transition, defense, and PLI (Production-Linked Incentive) schemes has led to robust traction in capital expenditure.

Despite geopolitical tensions in the Middle East and Europe, it is anticipated that steel demand in India won’t be significantly affected, especially with the construction period set to begin (September-March). India’s steel industry remains robust, with the momentum needing to be sustained in the future. Only a substantial slowdown in the US economy might potentially impact the demand.

India currently ranks as the world’s second-largest producer of crude steel, with an output of 125.32 million tonnes of crude steel and 121.29 million tonnes of finished steel in FY23. The country’s steel production is projected to grow by 4-7%, reaching 123-127 million tonnes in FY24.

JSW Steel reported domestic sales of 5.49 million tonnes, up by 8% year-on-year, primarily driven by strong domestic demand and product mix improvements. Exports constituted 11% of sales from Indian operations, totaling 0.69 million tonnes.

Consolidated crude steel production for the quarter was 6.34 million tonnes, marking a 12% year-on-year increase. The total combined volume of crude steel production reached 6.41 million tonnes, with a total sale volume of 6.39 million tonnes. The company underwent certain maintenance shutdowns at its Indian operations during the quarter, resulting in an average capacity utilization of 89%. The guidance for FY24 production is 26.34 million tonnes with sales of 25 million tonnes.

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