JSW Steel reported a 64% decline in net profit for Q1FY25, posting Rs 867 crore compared to Rs 2,338 crore in Q1FY24, amid weak revenues and lower production. The company’s Q1FY25 net profit fell below street expectations, with analysts estimating a net profit of Rs 1,280 crore.
The company’s revenues for Q1FY25 increased by 2%, reaching Rs 42,943 crore compared to Rs 42,213 crore in Q1FY24. Despite this modest growth, the company exceeded analysts’ revenue estimates of Rs 42,334 crore.The company reported an Ebitda of Rs 5,510 crore, 22% lower than the Rs 7,046 crore posted in Q1FY24. Analysts had estimated an Ebitda of Rs 5,781 crore.
JSW Steel’s Ebitda margins declined to 12.8% in Q1FY25 from 16.7% in Q1FY24.The company stated that consolidated crude steel production for the quarter stood at 6.35 million tonne, a decrease of 1% year-on-year (y-o-y) and 6% quarter-on-quarter (q-o-q). Capacity utilisation at the Indian operations was 87% during the quarter due to planned maintenance shutdowns at Dolvi and BPSL. Steel sales for the quarter were 6.12 million tonne, up 7% y-o-y but down 9% q-o-q. Domestic sales reached 5.31 million tonne, an increase of 14% y-o-y and 3% q-o-q. Sales volumes in the OEM & industrial segment grew by 18%, and the retail segment grew by 8% y-o-y. However, exports fell 29% y-o-y, making up 10% of sales from the Indian operations in Q1FY25 compared to 15% in Q1FY24.
The company also announced that its board approved the sale of an under construction 30 MTPA slurry pipeline in Odisha, being set up by its subsidiary JSW Utkal Steel, to another group company, JSW Infrastructure, for the transportation of iron ore slurry over a period of 20 years. The total planned capex of this project was estimated at approximately Rs 3,400 crore, which will now be incurred by JSW Infrastructure. The slurry pipeline project will be transferred on an arm’s length basis for a consideration of Rs 1,700 crore.