JSW Steel Q4: Profit Climbs, EBITDA Misses, BPSL Clouds Outlook

JSW Steel’s fourth-quarter FY25 results delivered a mixed bag, with strong profit growth but EBITDA falling short of expectations and uncertainty looming over its Bhushan Power and Steel Limited (BPSL) investment.

 

Key Highlights:

 

Profit Rises, Revenue Slips: JSW Steel’s consolidated net profit for Q4FY25 jumped 13.5% year-on-year to ₹1,501 crore, buoyed by reduced expenses. However, revenue from operations declined 3% YoY to ₹44,819 crore, reflecting softer steel prices and challenging market conditions.

 

EBITDA Below Estimates: Operating EBITDA stood at ₹6,378 crore, with a margin of 14.2%. While this marked a 14% sequential rise, it was lower than analyst estimates, weighed down by the revenue dip and margin pressures.

 

Record Volumes: The company achieved its highest-ever quarterly crude steel production and sales, with consolidated crude steel output at 7.63 million tonnes (up 12% YoY) and sales at 7.49 million tonnes (up 11% YoY). Domestic sales surged 30% YoY, highlighting robust demand in India.

 

BPSL Uncertainty: The Supreme Court’s rejection of JSW Steel’s resolution plan for BPSL has cast a shadow on the balance sheet. The court ordered a refund of payments made to BPSL’s creditors and directed liquidation proceedings. Auditors issued a qualified opinion due to the uncertain recoverability of JSW’s significant investments in BPSL, though management maintains there’s no material adverse impact and is exploring legal remedies.

 

Dividend & Fundraising: The board recommended a final dividend of ₹2.80 per share and approved capital-raising plans up to ₹14,000 crore through debentures and qualified institutional placements.

 

Outlook: While JSW Steel’s operational performance remains resilient, the BPSL issue introduces significant risk. Investors will watch closely for legal developments and clarity on asset recoverability in the coming quarters.

 

Sources: CNBC-TV18, Economic Times, Times of India