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Jindal Steel reported a muted performance in Q1FY27

ICICIdirect Research 27 Jul 2026 DISCLAIMER

News: Jindal Steel reported a muted performance in Q1FY27. Consolidated total operating income stood at ₹15,482 crore (up 26% YoY, down 5% QoQ), supported by steel sales volume of 2.2 MT (up 17% YoY, down 15% QoQ). Reported EBITDA came in at ₹2,660 crore, with EBITDA margin at 17.2% (down 94 bps QoQ). EBITDA/tonne improved to ₹11,930, compared with ₹11,695 in Q4FY26. Consolidated PAT for the quarter stood at ₹844 crore (down QoQ & YoY). The Board has approved the appointment of Mr. Vidya Rattan Sharma as the Managing Director of the company, effective 24 July 2026. He had previously served as the Managing Director from 2019 to 2022. Additionally, the company has appointed Mr. Sandeep Modi as the Chief Financial Officer. 

View: The topline performance was impacted by the planned maintenance shutdown during the quarter. Nevertheless, net steel realisations improved by over ₹7,500/tonne in Q1FY27, supported by the increase in domestic steel prices following the safeguard duty. However, the benefit was largely offset by higher raw material costs, with coking coal costs rising by US$23/tonne, negative operating leverage ~₹2,000/tonne, and additional freight costs of US$12-13/tonne due to the Middle East conflict. Consequently, EBITDA/tonne increased by only ~₹250/tonne during the quarter. Going forward, elevated coking coal costs of ~US$12-15/tonne coupled with drop in metal realisations from the top will weigh on margins in the near term. However, the ramp-up of the 6 MTPA expansion at the Angul plant is expected to support healthy volume growth, with the company reiterating its FY27 sales volume guidance of 10.5-11.0 MTPA (up ~21% YoY). In addition, the commissioning of the slurry pipeline in Q2FY27 is expected to generate incremental cost savings of around ₹700/tonne. Accordingly, we maintain a positive long-term outlook on the stock, supported by capacity expansion led volume growth in offerings and increasing focus on value-added products.

Impact: Neutral

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