Steel stocks are one of the few that have held their ground despite the broad market sell-off in the current calendar year, and in fact, they are also trading close to their 52-week highs.
For instance, leading players like JSW Steel, which declared its results during Friday trading hours, ended 1.4% higher at Rs 1,238.4 on Friday, and hovering not too far from its 52-week high of Rs 1,327.4 reached on 27 May, 2026.
Also, closest rival, Tata Steel was broadly flat at Rs 185.9 on Friday, and the stock reached a 52-week high of Rs 224.4 on 15 May, 2026.
Investors are bullish on steel sector, given continued strong demand from user industries like autos and construction / infrastructure sector. Of equal importance, steel prices are higher in the June 2026 quarter y-o-y, at a time when China, the largest steel producing nation has curtailed production during the current financial year.
The above trends are clearly visible in the results of JSW Steel that were declared during market hours on Friday.
Inside JSW Steel’s Q1FY27 Volume Drivers
JSW Steel has highlighted its consolidated steel sales volumes grew 4% y-o-y to 6.25 million tonnes in the June 2026 quarter. The company has highlighted that they were the best ever for the first quarter of a financial year.
Of equal importance, institutional sales were up 5% y-o-y to 3.7 million tonnes in the quarter under review, and along with sales to auto, renewable and appliances sectors were also the best ever for a June quarter.
It does appear that the Middle East crisis has not shown any visible impact on demand from user industries in the June 2026 quarter.
JSW Steel on a consolidated basis has operations in India, USA and Italy, with sales in the local market remaining key – steel sales in the Indian market were 6.02 million tonnes in the June 2026 quarter, a rise of 4% y-o-y.
JSW Steel has a combined crude steel capacity of 37.9 million tonnes including 4.5 million tonnes through the JSW JFE Steel JV at the end of the June 2026 quarter.
Margins Expand 220 Bps on Tighter Cost Efficiencies
JSW steel benefited from a combination of higher steel prices y-o-y in the June 2026 quarter along with a 4% y-o-y growth in its consolidated steel sales volumes.
The company’s realisations on a consolidated basis grew nearly 5.9% y-o-y to Rs 75,782 per tonne in Q1FY27, and along with higher steel sales, its consolidated revenue from operations grew 9.8% y-o-y to Rs 47,364 crore in the quarter under review.
The steel sector has been one of the key beneficiaries of the GST cuts the government had implemented in late September 2025. And while GST rates were not reduced for the steel sector, the sector has benefited from a reduction in GST rates for key user industries like autos, amongst other sectors.
A tight check on costs helped JSW Steel’s consolidated operating profit margin rise 220 basis points y-o-y to 19.8% in the June 2026 quarter.
Also, JSW Steel’s consolidated net profit rose 112.6% y-o-y to Rs 4,696 crore in the June 2026 quarter.
Operational Contrast: How Q1FY27 Defeated Q1FY26 Tailwinds
For a perspective on the difficult operating environment in the steel sector, we examined the June 2025 quarter of JSW Steel – its consolidated revenue from operations were broadly flat y-o-y basis at Rs 43,147 crore in Q1FY26, while its steel sales volumes were up 9% y-o-y to 6.69 million tonnes.
Realisations on a consolidated basis had declined nearly 9% y-o-y to Rs 64,494 per tonne in the June 2025 quarter.
However, a 43.6% y-o-y decline in mining premium and royalties to Rs 1,860 crore in the June 2025 quarter enabled the company to grow its consolidated net profit by 154.7% y-o-y to Rs 2,209 crore in the quarter under review.
Tata Steel Outlines Robust Domestic Delivery Metrics
Tata Steel’s key Indian operations reported a strong 8.8% y-o-y growth in steel delivery volumes to 5.17 million tonnes in the June 2026 quarter.
Strong local volumes helped offset the difficult operating environment in its European operations, and it resulted in Tata Steel’s total delivery volumes reach 7.38 million tonnes in the June 2026 quarter, a rise of 2.6% y-o-y.
Tata Steel ended FY26 with a capacity of 36 million tonnes across its Indian and global operations.
Tata Steel will declare its June 2026 quarter results on 30 July.
Growth outlook for JSW Steel
JSW Steel has highlighted the expansion of its facilities at Vijayanagar, Karnataka, from 3 million tonnes to 4.5 tonnes was completed and the blast furnace was lit up in June 2026. Also, the blast furnace has since ramped up to more than 80% within a few weeks and it will add incremental volumes from Q2 FY27 for JSW Steel.
Investors will also be keeping a close on demand from user industries and steel prices, going forward.
Capital Efficiency: Benchmarking RoE Across the Sector
JSW Steel has a Return on Equity (RoE) of 10.2% while for Tata Steel it is 11.7% and for SAIL it is 6.4%.
Return on Equity – efficiency pays
| Company | RoE (in %) |
| JSW Steel | 10.2% |
| Tata Steel | 11.7% |
| SAIL | 6.4% |
Valuations – does it still make sense to buy steel stocks
Steel stocks have managed to stay strong despite the broad sell- off in the broader stock markets in the current calendar year. It’s no surprise leading steel stocks are trading not too far from their 52-week high.
Valuations of JSW Steel versus peers
| Company | Consolidated P/E |
| JSW Steel | 25.2 |
| Tata Steel | 20.5 |
| SAIL | 17.6 |
JSW Steel trades at a consolidated P/E of 25.2, and over the past 5 years, it has traded between 6.5 times and 73.6 times.
Meanwhile, Tata Steel trades at a consolidated P/E of 20.5 times, and over the past 5 years, it has traded between 3.1 times and 183.2 times.
And SAIL trades at a P/E of 17.6 times, and over the past 5 years, it has traded between 2.2 times and 29.4 times.
The steel sector is expected to show strong growth over the next few quarters, and readers could add stocks from this sector to their watchlist for 2026.
Disclaimer:
Amriteshwar Mathur is a financial journalist with over 20 years of experience.
The writer and his family have no shareholding in any of the stocks mentioned in the article.
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