JSW Steel Ltd.’s fiscal second-quarter profit more than tripled, beating expectations, as India’s infrastructure buildout drove prices higher. Net income of the country’s biggest steelmaker by capacity increased 226% from a year earlier to 52.8 billion rupees ($556 million) in the three months through September, the company said in a statement Friday. Analysts had forecast about 43.5 billion rupees, according to an average of estimates compiled by Bloomberg.
India’s steelmakers are preparing for prolonged growth in demand as the government invests heavily in public works. The nation’s steel consumption is expected to more than triple to 505 million tons by 2047, according to a draft policy released this month, setting the stage for a major expansion among producers. JSW plans to spend as much as 240 billion rupees in the fiscal year through March 2027 to increase capacity.
The company approved the 161.5 billion-rupee second phase of expansion at its Odisha plant in eastern India to add 5 million metric tons of annual steelmaking output. It also cleared a plan to boost production at the firm’s Mozambique coking coal mine to 9 million tons a year. “Strong public and private sector investments across infrastructure, manufacturing and emerging industries continue to support the capex cycle and long-term growth prospects,” it said in the statement. The price of hot-rolled coil, part of JSW’s mainstay flat-steel operations, rose 21% over a year earlier to 59,902 rupees a ton in the three months through September, according to Kotak Institutional Equities.
The company reported a 5% increase in production over the quarter to 7.27 million tons. Revenue rose 21% on year to 544.9 billion rupees, while raw material costs increased 13% to 269.17 billion rupees.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing