Financial Performance for Q1 FY27 (Quarter Ended June 30, 2026)
Revenue from Operations: INR 1,146 crores, up 2% from INR 1,128 crores in Q1 FY26 but lower than INR 1,205 crores in Q4 FY26.
EBITDA: INR 203 crores, compared to INR 254 crores in Q1 FY26 and INR 209 crores in Q4 FY26.
EBITDA Margin: 18%, compared to 23% in Q1 FY26 and 17.3% in Q4 FY26.
EBITDA per ton: INR 8,787, compared to INR 11,068 in Q1 FY26 and INR 8,882 in Q4 FY26.
Profit Before Tax (PBT): INR 165 crores, compared to INR 216 crores in Q1 FY26 and INR 162 crores in Q4 FY26.
Profit After Tax (PAT): INR 124 crores with a PAT margin of 11%, compared to INR 174 crores (15% margin) in Q1 FY26 and INR 123 crores (10% margin) in Q4 FY26.
Operational Performance
TMT Bar Sales Volumes: Approximately 192,000 tonnes, broadly flat year-on-year but down 8% sequentially.
Billet Volumes: Grew 13% year-on-year and 38% sequentially.
Pellet and Sponge Iron Sales: Lower both year-on-year and sequentially due to higher captive consumption and a planned annual maintenance shutdown at the pellet plant.
Capacity Utilization: Gorakhpur unit at 93%; Kutch facility rolling mill at 66%.
Cost Structure
Raw Material Cost: Increased 9% year-on-year, outpacing revenue growth, driven by higher coal prices and geopolitical tensions impacting freight and input costs.
Employee Cost: Increased 24% year-on-year due to the full-year impact of the DRI plant commissioned last year, senior leadership strengthening, and annual salary revision effective April 2026.
Finance Costs: Reduced due to lower borrowings; company remains net debt-free with borrowings limited to working capital facilities.
Capital Expenditure and Expansion
Ongoing Capex Program: INR 3,000 crores, with approximately INR 800 crores spent over the last year and Q1 FY27.
Capacity Expansion: From 1 million to 1.23 million tonnes (23% growth) on track for commissioning in H2 FY27.
Funding: Entirely through internal accruals; no term loans.
Renewable Energy Initiatives: 85 MW solar power (18 MW in Gujarat commissioning in Q2 FY27; 67 MW in Gorakhpur commissioning in Q4 FY27).
Captive Iron Ore Mines: Three mines (two in UP, one in Rajasthan) under exploration and development; target operational date is FY28.
Industry Context and Outlook
Q1 Seasonality: Seasonally softer quarter for domestic steel industry due to monsoon, with construction and infrastructure activity slowdown.
Pricing: Long product prices (TMT/rebar) corrected meaningfully during the quarter.
Imports: India turned net importer of steel during the quarter; industry seeking anti-dumping measures.
Demand Outlook: Domestic steel demand expected to grow 7-9% in FY27; pricing recovery expected post-monsoon from September/October.
Capital Structure and Liquidity
Net Debt: Zero; net cash surplus company.
Cash Balance: Lower sequentially alongside a buildup in receivables and inventories, consistent with the quarter's production and billing profile.
Raw Material Sourcing: Detailed sourcing strategies for iron ore (from Odisha Mineral Corporation, Madhya Pradesh suppliers, Lloyds from Maharashtra) and coal (linkage with Coal India, imported South African coal via Itochu, Indonesian coal from Mundra/Kandla ports).
Market Position: Holds over 25% market share in UP; branding initiatives with celebrity endorsements (Janhvi Kapoor recently added).
Export Market: Not a focus; logistically challenging for construction steel from inland Gorakhpur unit.
Margin Sustainability: Attributed to end-to-end integration and debt-free status; expected to improve with solar power and captive mines.
Industry Outlook: Short-term muted demand in Q2 due to monsoon; strong longer-term demand driven by infrastructure spending in UP and Gujarat.
