Jindal Steel Limited — Q4 FY26 earnings call

Call held 2 May 2026

Management summary

Jindal Steel reported a strong Q4 and FY26, driven by significant capacity expansion and robust demand. Revenue and PAT saw healthy growth, though EBITDA per tonne declined year-on-year. The company completed major expansion projects, increasing steelmaking capacity to 15.6 MTPA, and is now focusing on asset sweating and value-added product mix optimization. An impairment charge was recognized for Australian assets, but management expects leverage metrics to normalize by Q2FY27.

Highlights

  • FY26 Consolidated gross revenue grew 8% YoY to INR 62,412 crores.

  • FY26 PAT increased 18% YoY to INR 3,361 crores, with EPS at INR 33.

  • Q4FY26 Consolidated gross revenue surged 28% QoQ to INR 19,399 crores.

  • Q4FY26 Blended ASP saw a significant increase of INR 4,743 per tonne QoQ.

  • Total steelmaking capacity expanded from 9.6 MTPA to 15.6 MTPA, with major projects like 1,050 MW power plant commissioned and slurry pipeline nearing completion.

Concerns

  • Impairment of Australian assets resulted in a write-down of INR 1,433 crores (standalone) and INR 834 crores (consolidated).

  • FY26 Adjusted EBITDA per tonne declined to INR 10,482 from INR 11,712 in FY25.

  • Coking coal prices are expected to increase by $20 to $25 per tonne sequentially in Q1FY27, potentially impacting margins.

Key financials

2 periods

Q4FY26

  • Consolidated Gross Revenue
    ₹19,399 Cr
    QoQ +28%
  • Adjusted EBITDA
    ₹2,647 Cr
  • Adjusted EBITDA per tonne
    ₹10,093
  • PAT
    ₹1,041 Cr
  • Blended ASP Increase
    ₹4,743
  • Production Volume
    2.65 million tonnes
    YoY +26% QoQ +6%
  • Sales Volume
    2.62 million tonnes
    YoY +23% QoQ +15%

FY26

  • Consolidated Gross Revenue
    ₹62,412 Cr
    YoY +8%
  • Adjusted EBITDA
    ₹9,099 Cr
  • Adjusted EBITDA per tonne
    ₹10,482
  • PAT
    ₹3,361 Cr
    YoY +18%
  • EPS
    ₹33
  • Production Volume
    9.25 million tonnes
    YoY +14%
  • Sales Volume
    8.68 million tonnes
    YoY +9%

What they filed

Q1 FY27: revenue up 25.9%, net profit down 43.6% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue11,213 11,751 13,183 12,294 11,686 +4%13,027 +11%16,218 +23%15,482 +26%
EBITDA2,200 2,184 2,262 3,006 2,081 −5%1,629 −25%2,929 +29%2,660 −12%
Net profit860 951 -304 1,496 635 −26%189 −80%1,041 +442%844 −44%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Capital allocation

high confidence
  • Capex ₹7,500 Cr
    • Capital expansion and sustenance capex ₹7,500 Cr
    I think our guidance has been fairly clear that we will be allocating INR 7,500 crores to INR 10,000 crores to our capital expansion programs or sustenance capex as we call it.
  • Debt Net ₹16,019 Cr · 1.7× EBITDA
    As of 31st March 2026, consolidated net debt was INR 16,019 crores with a net debt to EBITDA of 1.66x and debt to equity of 0.43x.
  • Dividend ₹2/share (final)
    The Board of Directors has recommended a final dividend of INR 2 per share.
  • M&A Australian Assets (WCL) Divestment · Abandoned

    Mine closure

    Impairment of INR 1,433 crores (standalone) / INR 834 crores (consolidated)

    Until the previous quarter, the Australian assets were under care and maintenance. This quarter, we have closed the shaft, and the reserves are no longer accessible, although we still have the license. Accordingly, we have recognized an impairment of INR 1,433 crores which equates to USD 159 million in the standalone business and INR 834 crores, which equates to USD 93 million in the consolidated results.

Guidance & targets

Volume

  • Production Volume Volume · FY27 · High confidence 11 million to 11.5 million tonnes
    With that context, our production plan for FY27 is 11 million to 11.5 million tonnes and sales between 10.5 million to 11 million tonnes.

    — Gautam Malhotra

  • Sales Volume Volume · FY27 · High confidence 10.5 million to 11 million tonnes

    — Gautam Malhotra

Capex

  • Capital Expansion/Sustenance Capex Capex · FY27 · High confidence INR 7,500 crores to INR 10,000 crores
    I think our guidance has been fairly clear that we will be allocating INR 7,500 crores to INR 10,000 crores to our capital expansion programs or sustenance capex as we call it.

    — Gautam Malhotra

Cost Savings

  • Slurry Pipeline Cost Savings Cost Savings · as we ramp up · Medium confidence INR 750 to INR 1,000 per tonne
    And roughly about INR 700 is the savings that we indicated on that. And if you want to take it to a per tonne basis on steel level, it will be roughly about INR 750 to INR 1,000 as we ramp up.

    — Gautam Malhotra

Debt

  • Leverage Metrics Normalization Debt · Q2FY27 · High confidence Normalized
    With the ramp-up of new capacities and corresponding improvement in operating cash flows, we expect leverage metrics to normalize by Q2FY27.

    — Gautam Malhotra

Product Mix

  • Flat Sales Mix Product Mix · in times to come · Medium confidence 70%

    From 50% today

    Currently 50:50. Flat sales will increase in times to come and move towards 70% odd as we move ahead.

    — Gautam Malhotra

Project Commissioning

  • Slurry Pipeline Commissioning Project Commissioning · Q1FY27 · High confidence Commissioned
    The pipeline is expected to be commissioned in this quarter, Q1FY27.

    — Gautam Malhotra

  • DRI 2 and PP2 Commissioning Project Commissioning · end of FY27 · High confidence Commissioned
    We have two projects left, which we had indicated for this financial year, which were DRI 2 and PP2. ... It is towards the end of the year.

    — Gautam Malhotra

Cost

  • Coking Coal Price Increase Cost · Q1FY27 · High confidence $20 to $25 per tonne
    For Q1FY27, we expect coking coal prices to increase by $20 to $25 per tonne sequentially.

    — Gautam Malhotra

What to watch in Q1 FY27

Slurry pipeline commissioning and cost savings realization

Q1FY27
Current Close to completion, expected Q1FY27
Target Commissioned, realizing INR 750-1,000 per tonne steel level savings

Why it matters

Direct impact on cost of production and overall profitability, a key efficiency driver.

On the slurry pipeline from Barbil to Angul, this challenging project is close to completion now. The pipeline is expected to be commissioned in this quarter, Q1FY27. ... roughly about INR 700 is the savings that we indicated on that. And if you want to take it to a per tonne basis on steel level, it will be roughly about INR 750 to INR 1,000 as we ramp up.

Risks & concerns

  • Volatility in raw material costs (coking coal)

    medium

    Raw material cost, particularly coking coal, may remain volatile, with an expected increase of $20-$25 per tonne in Q1FY27.

    Management acknowledged

  • Global demand weakness / geopolitical impact

    low

    The Middle East conflict has tempered near-term regional demand, but the broader global outlook remains largely resilient.

    Management downplayed

  • Safeguard duty reduction on flat steel imports

    low

    The safeguard duty on flat steel imports stepped down from 12% to 11.5% effective April 21, 2026.

    Management acknowledged

Q&A highlights

8 direct
Realization and market outlook for Q1FY27 Direct
So, you can see that our ASP has increased significantly and considerably in the last quarter. ... we still feel that at the moment, the market is holding firm, and there is nothing to worry about on that front.

Clarifies management's view on pricing trends and sustainability of Q4 ASP gains into Q1, indicating a stable market.

Asked by Jashandeep Chadha

Future Capex and Strategy Post-Expansion Direct
I think you are 100% right. We more or less finished our capex program. Our focus is on sweating the assets and getting returns out of them. ... we will be allocating INR 7,500 crores to INR 10,000 crores to our capital expansion programs or sustenance capex as we call it.

Signals a strategic shift from aggressive expansion to optimizing existing assets and provides clear capex guidance for FY27.

Asked by Jashandeep Chadha

Value-Added Product Mix Strategy during ramp-up Direct
At the moment, we are ramping up our facilities. And whilst in ramp-up, our primary goal is first to achieve capacity utilization. And once we start achieving the desired capacity utilization numbers, we start going towards the mix optimization. ... Currently 50:50. Flat sales will increase in times to come and move towards 70% odd as we move ahead.

Explains the current focus on volume over mix during ramp-up and provides a long-term target for value-added product share, which impacts margins.

Asked by Darshan Mehta

Australian Asset Write-down and future impairments Direct
WCL, Australian asset, by INR 834 crores, mainly because we are going to close that mine. ... So, we do not expect any further write-offs. This is represented by the independent valuation done by reputed agency.

Clarifies the reason and magnitude of the write-down and provides assurance that no further significant impairments are expected, reducing future financial uncertainty.

Asked by Satyadeep Jain

Slurry Pipeline Cost Savings and Commissioning Direct
Slurry will come online, and it will start delivering in this financial year. And roughly about INR 700 is the savings that we indicated on that. And if you want to take it to a per tonne basis on steel level, it will be roughly about INR 750 to INR 1,000 as we ramp up.

Provides specific cost savings expected from a key infrastructure project and its commissioning timeline, directly impacting cost of production.

Asked by Vikas Singh

Thermal Power Plant Excess Power Strategy Direct
So, I think the ramp-up will be complete within the first half of this year. In terms of the excess power, yes, we intend to sell it. But if you look at the overall picture and the financials, it is not really material to that. But it does 2-3 things. One, obviously, we can sell the excess power, but it gives us stability of power for our assets, and it gives us redundancy of power for our facilities as well.

Explains the plan for excess power generation and its strategic benefits beyond direct financial contribution, ensuring power stability for operations.

Asked by Amit Murarka

Raw Material Security and Backward Integration Direct
All our announcements are there. The new mines are also announced. So that is also available. So, we have the coal mine and the iron ore mine, as I indicated. And the current capacities are already, I think, in the pack for each mine.

Reassures about the progress on captive raw material sources, which is crucial for cost control and operational stability in the steel industry.

Asked by Ashish Jain

Key Project Commissioning Timelines (DRI 2, PP2) Direct
We have two projects left, which we had indicated for this financial year, which were DRI 2 and PP2. ... It is towards the end of the year.

Provides specific timelines for the remaining major expansion projects, which are critical for reaching full capacity and improving efficiency.

Asked by Pinakin Parekh

3 min read 7 chapters

Detailed narrative

Capacity Expansion and Ramp-up Progress

Jindal Steel successfully expanded its total steelmaking capacity from 9.6 million tonnes per annum (MTPA) to 15.6 MTPA in FY26. This was driven by significant progress on the Angul expansion, including the commissioning of BF2 (4.6 MT) and 1,050 MW Shree Bhoomi Power Plant. The cold rolling complex of 1.2 MTPA is also operational, and the slurry pipeline from Barbil to Angul is expected to be commissioned in Q1FY27, further enhancing operational efficiency.

Financial Performance Highlights for FY26 and Q4FY26

For FY26, consolidated gross revenue increased 8% YoY to INR 62,412 crores, with PAT growing 18% YoY to INR 3,361 crores. Adjusted EBITDA stood at INR 9,099 crores, translating to INR 10,482 per tonne. Q4FY26 saw a strong sequential recovery, with gross revenue up 28% QoQ to INR 19,399 crores and PAT at INR 1,041 crores. The blended ASP increased significantly by INR 4,743 per tonne QoQ in Q4FY26.

Production and Sales Volume Growth

FY26 production volume reached 9.25 million tonnes, a 14% YoY increase, while sales volume grew 9% YoY to 8.68 million tonnes. Q4FY26 demonstrated robust growth, with production volume at 2.65 million tonnes (up 26% YoY and 6% QoQ) and sales volume at 2.62 million tonnes (up 23% YoY and 15% QoQ), reflecting strong ramp-up at Angul and improved capacity utilization.

Capital Allocation and Debt Management

The company invested INR 9,574 crores in capex during FY26, bringing the total investment in the current program to INR 35,498 crores since FY22. Consolidated net debt as of March 31, 2026, was INR 16,019 crores, with a net debt to EBITDA ratio of 1.66x and debt to equity of 0.43x. Management expects leverage metrics to normalize by Q2FY27. A final dividend of INR 2 per share was recommended.

Strategic Focus on Asset Sweating and Value-Added Products

With the major capex program largely complete, Jindal Steel's strategy is shifting towards 'asset sweating' to maximize returns from existing capacities. While currently focusing on capacity utilization during ramp-up, the company aims to recalibrate towards a higher value-added product mix, targeting a shift from the current 50:50 flat-to-long product mix towards 70% flat sales in the future. This optimization is expected to show movement in H1 FY27 and stabilize in H2 FY27.

Raw Material Security and Cost Outlook

Jindal Steel continues to strengthen its raw material security, having been declared the preferred bidder for the Thakurani-A1 iron ore block and awarded the Saradhapur Jalatap East coal block. While the Mozambique mine is EBITDA positive, the South Africa mine is operating but not yet EBITDA positive. Management anticipates coking coal prices to increase by $20-$25 per tonne sequentially in Q1FY27, indicating potential cost volatility.

Market Outlook and ESG Progress

India remains the world's fastest-growing major steel market, with domestic demand projected to expand by 7.4% in 2026 and 9.2% in 2027, underpinned by broad-based strength across key consuming sectors. India became a net exporter of steel with 0.1 million tonnes in FY26. The company also reported significant ESG progress, with S&P Global ESG score improving from 37/100 to 74/100 and CSA score from 30 to 72.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Metals & Mining earnings calls