JSW Steel Limited, one of India's leading steel manufacturers, has released its comprehensive financial results for the second quarter of fiscal year 2024-25, demonstrating resilience amid challenging market conditions. The company's consolidated operations showed mixed performance across its global facilities, with notable achievements in domestic sales despite international market pressures and ongoing global economic uncertainties.
The company's consolidated crude steel production reached an impressive 6.77 million metric tons, marking a significant 7% increase both year-over-year and quarter-over-quarter. Indian operations demonstrated particularly strong performance with a capacity utilization of 91%, following the successful completion of planned maintenance shutdowns at Dolvi and BPSL facilities. The consolidated steel sales volume stood at 6.13 million metric tons, with domestic sales achieving a record high of 5.57 million metric tons, representing a 1% YoY and 5% QoQ growth, highlighting the company's strong position in the domestic market.
Financial performance indicators showed the company generating substantial revenue from operations of ₹39,684 crores, with an Operating EBITDA of ₹5,437 crores and an EBITDA margin of 13.7%. The quarter's profit after tax was recorded at ₹404 crores, factoring in an exceptional charge of ₹342 crores. The company maintained commendable financial stability with a net debt to equity ratio of 1.04x and net debt to EBITDA of 3.51x, demonstrating prudent financial management despite market volatility. These metrics reflect the company's ability to maintain operational efficiency while managing its debt obligations effectively.
Subsidiary performance varied significantly across regions, presenting a complex picture of global operations. Bhushan Power & Steel achieved a significant milestone by completing its capacity expansion from 3.5 million metric tons per annum to 4.5 million metric tons per annum, though it reported a loss of ₹93 crores for the quarter due to lower sales realization and increased operational costs. JSW Steel Coated Products demonstrated steady performance with production volume of 1.08 million metric tons and sales volume of 0.99 million metric tons, generating revenue of ₹7,695 crores and an EBITDA of ₹341 crores, showcasing the strength of its value-added products segment.
The company's international operations faced various operational and market-related challenges. JSW Steel USA Ohio operated at 43% capacity utilization due to maintenance shutdowns, producing 156,137 net tons of slabs and reporting an EBITDA loss of $16.14 million. The US Plate & Pipe Mill in Texas showed mixed results with plate production at 108,969 net tons and pipe production at 9,687 net tons, achieving an EBITDA of $5.04 million. These results reflect the ongoing challenges in the US market, including fluctuating demand patterns and pricing pressures.
Export performance was notably affected by global market conditions, particularly due to elevated Chinese exports and international trade dynamics. Total exports fell by 43% YoY and 34% QoQ, constituting only 7% of sales from Indian operations in Q2 FY25, compared to 10% in the previous quarter. The institutional segment showed strong growth with a 12% YoY increase, demonstrating the company's strong relationships with key industrial customers. However, the retail segment experienced a 14% decline due to high import levels, highlighting the impact of international competition on domestic market dynamics.
The standalone performance of JSW Steel showed robust crude steel production of 5.77 million metric tons, up 7% YoY and 9% QoQ, with sales of 5.30 million metric tons. The standalone operations generated impressive revenue of ₹30,778 crores and an Operating EBITDA of ₹4,641 crores, maintaining a healthy EBITDA margin of 15.1% and achieving a profit after tax of ₹1,299 crores. These results underscore the company's strong core operations and effective cost management strategies.
The Italian operations contributed to the company's global presence with production of 83,376 metric tons and sales of 78,900 metric tons, though facing their own set of operational challenges in the European market context. The European operations continue to adapt to regional market conditions, energy cost fluctuations, and regulatory requirements, demonstrating the company's ability to maintain operations across diverse geographic locations and regulatory environments.
The company's performance in Q2 FY25 also reflects its ongoing commitment to sustainability and technological advancement, with continued investments in modernization and environmental compliance across its facilities. Despite the challenges in various markets, JSW Steel has maintained its focus on operational excellence, cost optimization, and strategic growth initiatives, positioning itself for long-term success in the global steel industry.
