Jindal Steel Ltd (JINDALSTEL) Q2FY27 Concall Transcript - Sep-2026 Qtr
Moderator (ICICI Securities Limited): Ladies and gentlemen, good day, and welcome to Jindal Steel Q2 FY '27 earnings conference call hosted by ICICI Securities Limited. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star, then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Vikash Singh. Thank you, and over to you, sir.
Vikash Singh (ICICI Securities Limited): Thank you, ma'am. A warm welcome to everybody. Good evening. We would like to thank the management to give us the opportunity to host them. Without taking any much time, I'll hand over to Vishal for the management introduction and opening the call. Over to you, Vishal.
Vishal Chandak (Jindal Steel Ltd): Thank you very much, Vikash. Ladies and gentlemen, a very good afternoon. Thank you very much for joining us to discuss the Q2 FY '27 earnings release of Jindal Steel. Joining us on today's call are members of our senior management team, Mr. V.R. Sharma, Managing Director, Mr. Rajiv Kumar, Chief Operating Officer, Mr. Sandeep Modi, CFO, Mr. Damodar Mittal, Whole-Time Director, Mr. Debojyoti Roy, Executive Director, Raigarh, and Ms Rupali Mehra, Head of Sales and Marketing. I will now hand over the floor to Mr. V.R. Sharma for his opening remarks. Over to you, sir.
V.R. Sharma (Jindal Steel Ltd): Good afternoon, ladies and gentlemen, my friends, the well-wishers of our company, the media persons. I'm delighted to invite you on today's interaction. It's not only an investors meet or investors discussion. This is a two-way exchange. We will be happy to take your questions after this particular session.
V.R. Sharma (Jindal Steel Ltd): sales, and in, in history of all this, of this company in any quarter, in last so many years. That is 19,448 crores. So, I think we are now on a path to reach to 1 lakh crore rupees per year of sales. This is what our aim is. With 19,448 if we multiply by four quarters that should be 80,000, but our aim is to reach to 1 lakh crore as early as possible. The steel sales is up by 27%, EBITDA is up by 34%, in spite of very bad weather in Odisha. A lot of rains were there, the iron ore mines were full of water. We could manage a fairly good production. And we are now going to ramp up further. Our aim is to reach to about 11, 11 million ton production this financial year, this what we targeted earlier. We have reached to a level of about 4.79 million in H1. And the next that is H2 we are aiming for 6 million ton. So, this is a net steel, the gross steel maybe about 11, 11 million. The company is doing very well in terms of availability of the raw materials, whether it is coking coal, or it is iron ore, or availability of pellets through our internal internal resources, or other consumables. We have seen in last 3 months time a very topsy-turvy situation, where we found that there was a shortage of natural gas in the country, and there was a shortage of propane, and this was difficult time basically, because of this Hormuz issue, or the Iran and US war. So, fortunately we are having the coal gasification plant, and we switched over coal gas, that is the syn gas for many of the reheating furnaces, galvanizing lines, color coating lines, and there was no impact on our productivity, production and profitability. And still we are continuing. We are not using propane or natural gas. We are using our coal gas that is called syn gas, or you can say the coal, the gas through coal gasification route. Our DRI plant has also done well and this is based on coal gas, that is again we call it syn gas. We have two blast furnaces in Angul and two blast furnaces in Raigarh. So, all four blast furnaces, they are doing well now. The new blast furnace which we installed last year that has to reach to a level of about 10,000 tons per day, that is in Angul. Hopefully, we will ramp it up in this particular month. Say, today is 23rd so, I think in 7 days time, it should reach to about 10,500 tons per day, and in November, we are aiming for 11,000 and then December 12,000 tons per day. Availability of iron ore from OMC and NMDC is seamless, there is no problem. The problems related to landslide from NMDC route to Angul route, those are over now. Railway is working. And the water from mines is already receded. So, now the operations at OMC, all eight mines they are working very well. So, our own mine, Kasia mine, that also that is being ramped up earlier and we are sourcing material from our own mines also. We have two pellet plants, one in two pellet plant in Barbil, both are running well and the pellet plant in Angul is also running well, well. So, by and large, I would say that the company is in very, very solid state and we'll be making a record production in the Q3 which will be ending on December 2026. Q4, we are further looking very positive and we feel that we'll be surpassing the records what we are going to make in in Q3, I think Q4 will be much better. As far as the market is concerned, the market is supporting very well. Though the input costs have gone up, but we could recover the entire input costs and we could make some
V.R. Sharma (Jindal Steel Ltd): impact in NSR while we compare on the input costs. So the steel scenario is very good, I think it is now 10% YoY basis there is a growth. Though our production has gone up by 22%, the industry overall growth is about 10%. So we are aiming that we'll continue making such performance in other two quarters also that is Q3 and Q4. The exports are also picking up, we are we are doing about 100,000 tons of export every month mainly hot-rolled coils and plates. And some quantity in rails and the structures. We are hopeful the honorable Finance Minister the Commerce Minister, Mr. Piyush Goyal, he's already in Germany. And I think he is negotiating with EU on the on the basis of the mother of all deal what we signed is FTA. So I'm sure he's taking up with the government of or the European EU parliament how to give us a most favored steel suppliers status, so hopefully this will be done. We are very sure. And government is trying its best to utilize the FTAs in the interest of Indian engineering industry, Indian steel industry, Indian aluminum industry, and also for Indian garments and other industries. So we have seen a very positive impact from UK and the moment the quota system by EU is relaxed for India, which we are very much hopeful, and Government of India is trying its best, then there'll be another door opening to sell more and more steel to Europe. There's a steel deficit of about 28 million ton in Europe, and I think India stands the first chance to to supply the right and good quality of steel to Europe. CBAM is an issue today, but overnight the CBAM CBAM cannot be diluted. I think EU parliament and Government of India will find some solution how to meet out the demand of the local people there in Europe and they can enjoy the the
Moderator (ICICI Securities Limited): Ladies and gentlemen, the line for the management seems to have disconnected. Please hold while we reconnect.
Moderator (ICICI Securities Limited): Ladies and gentlemen, the management line has been reconnected. Over to you, sir.
V.R. Sharma (Jindal Steel Ltd): So, sorry there was a disconnection, and now I think I'm audible to everybody. So, coming back on the steel steel scenario, the outlook is very positive. The demand in the country is very good. I'm also pleased to inform you that 192 km long slurry pipeline is already commissioned. The commercial supplies to a plant from Barbil to Angul will will be starting, I think, in next 2-3 days' time. All trials are done. The first lot, first batch of iron ore slurry has been dispatched and well received. So tomorrow again we are going to restart and hereafter this will be continuous operation without any stoppage. We are now aiming to increase our overall product mix towards flat products. Though today also we are at a level of about 60-40. Now we'll be reaching somewhere about 65-35. 65% flat products including plates and 35% will be long products. So this is what we are aiming for. Now I'll request my other colleagues. They will speak to you and they'll give the the numbers what we are already declared. Many of you must have seen that the results are declared and already displayed to the media. Thank you very much.
Sandeep Modi (Jindal Steel Ltd): Good afternoon, sir. Myself Sandeep. Let me take you through Jindal Steel's consolidated financial performance for this Q2 FY '27. We have delivered our highest-ever quarterly gross revenue of 19,448 crore, up 44% YoY, while net revenue increased 43% YoY to record 16,704 crores. This was driven by the record Q2 sales volume, as Mr. Sharma said, of 2.38 million tonnes and higher average selling prices supported by a higher share of flats and a lower proportion of TMT within the long products. Domestic sales accounted for approximately 92% of total volume. Our adjusted EBITDA stood at 2,504 crore, up 34% year-on-year, while adjusted EBITDA per tonne increased 5% YoY to ₹10,529 per tonne. The sequential moderation in EBITDA was primarily due to higher raw material and operating costs, notwithstanding the positive impact of higher volume and improved sales mix. Coming to the cost part, coking coal was a key cost impact and it was within the guidance what we have given in the last call for $12 to $15 per tonne. Power and fuel, as well as freight expenses, especially ocean freight, also increased sequentially. This impact was partly offset by better ASP. Our consolidated profit after tax was 771 crore, compared with 844 crore in the preceding quarter. Our balance sheet strengthened during the quarter. Our consolidated net debt declined by 1,141 crore from 15,927 crores at the end of June to 14,786 crore as at September end. Net debt-to-EBITDA ratio improved from 1.71 to 1.51. Cash and cash equivalents stood at 7,237 crore, providing substantial liquidity as we execute our growth program. CapEx during Q2 FY '27 was 1,228 crore, and in the whole H1 was 3,187 crore. We remain continue to disciplined capital allocation with investment directed towards our steel and supporting infrastructure businesses, and a focus on return as the newly commissioned facilities ramp up. Our stated framework envisages annual growth CapEx of approximately 7,500 to 10,000 crore
Sandeep Modi (Jindal Steel Ltd): primarily funded through internal accruals, while seeking to maintain net debt-to-EBITDA below 1.5x through the cycle. For the second half, our priorities are clear: stabilize and ramp-up the expanded facilities, improve product mix, cost competitiveness, working capital management and maintain balance sheet discipline. With that, we can open the floor for questions. Thank you.
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