JSW Steel Q3 Results Review - Rising Costs To Hit Margins In Near Term: Prabhudas Lilladher

Prabhudas Lilladher Report

We cut our FY25E/FY26E Ebitda estimates by 7%/2% on weak steel pricing and inching raw material prices JSW Steel Ltd. reported strong consolidated operating performance in Q3, aided by subsidiaries despite 4% QoQ volume decline in standalone business.

Although domestic demand was weak in Q3, management reaffirmed FY24 production and sales volume target of 26.34 mt and 25 mt respectively; as demand is expected to remain strong in Q4.

JSW Steel is expected to deliver 15% plus volume compound annual growth rate over FY23-26E led by ongoing capacity additions and robust infrastructure activities in domestic market. JSW Steel expects domestic prices to inch up as global pricing is strong and China is taking steps to revive its economy.

Also JSW Steel rising focus on value added and specialised portfolio is expected to improve product mix and resilience for withstanding steel price volatility.

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