JSW Steel experienced a larger-than-expected profit decline in the second quarter of fiscal 2024-25 (July-September 2024). The company attributed this to weak demand and an increase in cheap finished steel imports, which pushed domestic prices to multi-year lows.
In the quarter ended June 30, profit at JSW Steel, the country's largest steelmaker by market value, fell sixfold to 4.39 billion rupees (about USD 52.23 million). Domestic steel prices hit a three-year low, a major factor contributing to the decline.
The company reported a 3.3% decline in steel sales to 6.13 million tons in the July-September period, while production rose by 7% to 6.77 million tons. The quarter was characterized by sluggish demand due to above-average rainfall, which negatively impacted operations in key sectors such as infrastructure and automotive.
Moreover, the company's revenue from operations fell by 11% to 396.84 billion rupees (about USD 4.79 billion), below analysts' average estimate of 423.26 billion rupees (about USD 5.08 billion).
In light of the challenging market conditions, JSW Steel revised its capital expenditure plans for the current fiscal year, lowering its budget to 160-170 billion rupees (about 1 billion USD) from 200 billion rupees (about 2.41 billion USD) previously.
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