Higher domestic and export hot-rolled coil (HRC) prices and a richer value-added product mix helped cushion the impact of lower sequential production and rising raw material costs on Jindal Steel Ltd's earnings during the April-June quarter. Planned maintenance shutdowns reduced crude steel output and sales from the preceding quarter, while elevated coking coal prices and weaker fixed-cost absorption continued to pressure margins.
The company produced 2.40 million mt of crude steel in Q1FY27, up 14% from 2.09 million mt in Q1FY26 but down 10% from 2.65 million mt in Q4FY26. Steel sales rose 17% year on year to 2.23 million mt from 1.90 million mt, although they declined 15% from 2.62 million mt in the preceding quarter as maintenance shutdowns temporarily reduced output. Stronger steel realizations and a higher share of value-added products partly offset the volume impact.
HRC price gains cushion higher raw material costs
Domestic flat steel prices strengthened during the quarter, providing a more supportive pricing environment despite persistent pressure from imported coking coal.
Mumbai domestic HRC averaged INR58,627/mt ($682/mt) in Q1FY27, up INR6,896/mt ($80/mt) year on year and INR4,869/mt ($57/mt) quarter on quarter. Export HRC prices also strengthened, averaging INR55,213/mt ($642/mt), up INR7,028/mt ($82/mt) from Q1FY26 and INR6,578/mt ($76/mt) from Q4FY26.
Long steel prices remained comparatively weaker. Mumbai TMT averaged INR57,115/t (USD664/t), increasing INR1,754/t (USD20/t) year on year but easing INR92/t (USD1/t) from Q4FY26 as seasonal demand softened toward the end of the period. According to Jindal Steel, TMT traded at a discount to HRC during the quarter.
Raw material costs continued to weigh on profitability. Premium hard coking coal averaged $261/mt, increasing $62/mt annually and $8/mt quarter on quarter, reflecting seasonal supply disruptions in Australia and stronger Chinese buying. Domestic iron ore prices softened sequentially after remaining elevated through most of the quarter. Odisha 62% Fe fines averaged INR5,354/mt ($62/mt), down INR519/mt ($6/mt) from Q4FY26 but still INR235/mt ($3/mt) above year-earlier levels, while Odisha 63% Fe lumps averaged INR7,412/mt ($86/mt), down INR546/mt ($6/mt) sequentially and INR77/mt ($1/mt) higher year on year.
The improvement in flat steel prices proved particularly beneficial for Jindal Steel because of its changing sales mix. Flats accounted for 53% of total sales in Q1FY27 compared with 44% in Q1FY26, while value-added products increased to 66% of total sales from 61% in the preceding quarter. The richer product mix helped offset lower shipments and higher raw material costs, limiting the impact on earnings despite a weaker production quarter.
Indian steel demand remains resilient despite rising imports
India's steel market continued to outperform most major economies during the quarter, with domestic consumption growing faster than production. However, rising imports meant the country remained a net finished steel importer for a second consecutive quarter.
India produced 42.0 million mt of crude steel during Q1FY27, up 3% from 40.8 million mt a year earlier but down 6% from 44.7 million mt in Q4FY26. Finished steel consumption increased 8% year on year to 41.5 million mt, although it moderated 7% sequentially from the seasonally stronger March quarter. On a full-year basis, FY26 crude steel production reached 169.2 million mt, up 11%, while finished steel consumption rose 8% to 164.2 million mt.
Exports also improved, with finished steel shipments increasing 31% year on year to 1.6 million mt during Q1FY27, though they declined 12% from Q4FY26. Imports rose much faster, increasing 49% year on year and 10% quarter on quarter to 2.1 million mt, leaving India a net finished steel importer by roughly 500,000 mt during the quarter.
The divergence between demand growth and production highlights the strength of India's domestic steel market but also underlines the challenge posed by imports. Consumption expanded more rapidly than production during the quarter—8% compared with 3%—allowing imports to increase despite stronger exports. While demand fundamentals remain supportive, sustained import pressure could limit domestic price gains as new steelmaking capacity is commissioned across the country.
India expected to remain the world's strongest steel demand market
Jindal Steel expects India to remain the principal engine of global steel demand over the next two years, contrasting sharply with the continued slowdown in China.
According to the company's presentation, global steel demand is forecast to remain broadly stable at 1.724 billion mt in CY2026 compared with 1.718 billion mt in CY2025 before increasing to 1.762 billion mt in CY2027. India is expected to account for most of that growth, with apparent steel demand forecast to increase from 160 million mt in CY2025 to 172 million mt in CY2026 and 187 million mt in CY2027, representing annual growth of 7% and 9%, respectively.
By comparison, Chinese steel demand is forecast to decline from 796 million tonnes in CY2025 to 784 million tonnes in CY2026 before remaining unchanged in CY2027. Demand in the United States is projected to rise steadily from 91 million tonnes to 94 million tonnes over the same period, while the EU and UK are expected to recover more gradually, reaching 151 million tonnes in CY2027. Japanese demand is forecast to remain broadly flat.
The contrasting outlook highlights India's growing importance within the global steel industry. Between CY2025 and CY2027, India is expected to add 27 million tonnes of steel demand, while Chinese consumption is forecast to decline by 12 million tonnes. For Indian producers, this provides a supportive domestic demand backdrop, although pricing will continue to be influenced by regional trade flows.
Chinese export overhang continues to cap regional prices
China remains the principal external factor influencing steel prices across Asia despite its weakening domestic market.
Chinese crude steel production declined to 950 million tonnes in CY2025 from 1 billion tonnes in CY2024, while apparent steel consumption fell more sharply to 796 million tonnes, extending the country's multi-year demand contraction. At the same time, exports climbed to 119 million tonnes, the highest level presented by Jindal Steel, reflecting the continued redirection of surplus steel into overseas markets.
Chinese HRC export prices averaged around $501 per tonne in June 2026, remaining well below the highs recorded during 2021. Jindal Steel attributed the weak domestic market to continued pressure from China's property sector despite tighter supply discipline.
For Asian steel producers, the combination of declining Chinese domestic demand and elevated export volumes continues to represent the principal downside risk to regional pricing. While India's demand outlook remains considerably stronger than that of other major steel-producing economies, continued Chinese exports and rising imports into India could constrain domestic price increases even as Indian producers ramp up new capacity.
Production recovers on annual basis despite planned maintenance shutdown
Jindal Steel's crude steel production increased from the corresponding period last year despite maintenance-related disruptions during the quarter. The company produced 2.40 million mt of crude steel in Q1FY27, up 14% from 2.09 million mt in Q1FY26 but down 10% from 2.65 million mt in Q4FY26. Full-year production reached 9.25 million mt in FY26, an increase of 14% from 8.12 million mt in FY25.
Total steel sales rose 17% year on year to 2.23 million mt, supported by higher production from newly commissioned facilities. Sequentially, however, sales declined 15% from 2.62 million mt as lower output during the maintenance shutdown reduced deliveries.
Domestic sales increased 15% year on year to 2.03 million mt, accounting for approximately 91% of total shipments, although they fell 19% from the previous quarter. Export volumes climbed to 210,000 mt, up from 140,000 mt in Q1FY26 and 130,000 mt in Q4FY26, increasing exports' share of total sales to 9% from 7% a year earlier and 5% in the March quarter.
While exports provided some support during the quarter, Jindal Steel remains predominantly leveraged to India's domestic market, with domestic sales continuing to account for the overwhelming majority of shipments.
Higher value-added mix supports realizations
The company's sales mix continued shifting toward higher-value products, helping offset pressure from lower volumes and rising raw material costs.
Value-added steel accounted for 66% of total sales during Q1FY27 compared with 61% in Q4FY26, while flat products increased their share to 53% from 44% in Q1FY26. The richer mix enabled the company to capture the benefit of stronger HRC prices during the quarter and partially mitigate the impact of higher coking coal costs.
Infrastructure remained the largest end-use segment, accounting for 31% of sales, followed by distribution at 29%, engineering and packaging at 19%, building and construction at 18%, and automotive at 3%. The engineering and packaging segment recorded the most notable increase, rising from 11% in both Q1FY26 and Q4FY26 to 19%, reflecting a stronger contribution from industrial applications.
TMT sales totaled 528,000 mt during the quarter, broadly in line with the corresponding period last year but below 621,000 mt recorded in Q4FY26 because of seasonal weakness. Retail sales accounted for 47% of TMT volumes while project sales represented 53%.
Angul expansion shifts focus from construction to execution
With the completion of its Angul expansion, Jindal Steel has entered a new phase where execution and capacity utilization become more important than capital construction.
The company's total crude steel capacity has increased to 15.60 million mt per year from 9.60 million mt, including the commissioning of the 12 million mt per year Angul integrated steel plant. Finished steel capacity now stands at 13.25 million mt per year, while ironmaking capacity has reached 15.02 million mt per year. DRI capacity has expanded to 5.12 million mt per year from 3.12 million mt, alongside increases in blast furnace, rolling mill and downstream processing capacities.
The expansion positions the company to benefit from India's forecast increase in steel demand over the coming years. However, the focus now shifts toward ramping up utilization while maintaining profitability. Additional domestic supply will enter a market where demand remains strong but import competition and Chinese exports continue to influence pricing. Successful execution will therefore depend not only on higher production but also on sustaining margins as new assets stabilize.
Captive raw materials strengthen integration
Jindal Steel continued expanding its raw material integration during the quarter with the commencement of coal dispatches from the Utkal B1 mine.
The company's coal portfolio now includes the commissioned 4 million mt per year Gare Palma IV/6 mine, 3.37 million mt per year Utkal C mine, and the combined 8 million mt per year Utkal B1 and B2 blocks. Overseas coal assets comprise 5 million tonnes per year in Mozambique and 1.2 million mt per year in South Africa.
Its iron ore portfolio includes the 3.11 million mt per year Tensa mine, 7.5 million mt per year Kasia mine, and 3 million mt per year Roida-I mine, providing greater security of raw material supply. Although captive resources should gradually reduce dependence on purchased coal and iron ore, imported premium hard coking coal remains a significant cost component for blast furnace operations.
Higher realizations offset weaker volumes, but profitability remains under pressure
Higher steel prices and an improved product mix largely compensated for lower shipment volumes during the quarter, allowing earnings to remain broadly stable sequentially despite production disruptions.
Adjusted EBITDA totaled INR26.67 billion ($310 million), compared with INR26.47 billion ($308 million) in Q4FY26 but below INR29.84 billion ($347 million) in Q1FY26. EBITDA per mt improved sequentially to INR11,937/mt ($139/t) from INR10,093/t ($117/mt), reflecting stronger steel realizations, although it remained below INR15,680/mt ($182/mt) recorded a year earlier.
Gross revenue increased 24% year on year to INR178.34 billion ($2.07 billion), while net revenue rose 26% to INR155.01 billion ($1.80 billion). Sequentially, however, gross and net revenue declined 8% and 6%, respectively, because of lower shipment volumes following the maintenance shutdown.
The company's EBITDA bridge showed that higher net sales realizations contributed INR13.43 billion ($156 million) sequentially, while subsidiaries added INR800 million ($9 million). These gains were offset by an INR3.93 billion ($46 million) impact from lower volumes and INR10.10 billion ($117 million) of higher costs, primarily reflecting increased raw material expenses and weaker fixed-cost absorption.
Depreciation and finance costs increased following the commissioning of new assets, while profit after tax declined 19% quarter on quarter and 44% year on year to INR8.44 billion ($98 million). According to the company, lower other income and changes in the tax mix across operating entities also affected bottom-line performance.
Although higher HRC prices helped stabilize EBITDA during the quarter, profitability continues to be constrained by elevated imported coking coal prices, higher depreciation associated with newly commissioned facilities, and the temporary underutilization of expanded capacity. As utilization improves, fixed-cost absorption should strengthen, allowing a greater proportion of higher steel realizations to flow through to earnings.
Outlook
India's steel market continues to provide one of the strongest demand environments globally, with domestic consumption expected to outpace most major producing regions over the next two years. For Jindal Steel, the completion of the Angul expansion provides the platform to capitalize on that growth, but the next phase of performance will depend on successfully ramping up production while maintaining margins.
The company's near-term earnings outlook will continue to be shaped by three factors: domestic HRC prices, imported premium hard coking coal costs, and the pace of capacity utilization. Higher-value products and stronger flat steel prices supported earnings during Q1FY27 despite maintenance-related disruptions, illustrating the benefits of the company's evolving product mix.
Nevertheless, the broader market environment remains mixed. India's domestic demand outlook remains robust, but rising finished steel imports and continued high Chinese export volumes could limit domestic steel price increases as additional Indian capacity enters the market. Against that backdrop, successful execution of the Angul expansion, continued growth in value-added products, and increasing captive raw material availability are likely to determine the company's earnings trajectory over the coming quarters.
($1=INR86)
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