Steel Authority of India Limited Q2 and H1 FY'27 Results Presentation

Company Overview

Steel Authority of India Limited (SAIL) presented its operational and financial performance for the second quarter and first half of fiscal year 2027.

Global Economic Context

The International Monetary Fund (IMF), in its World Economic Outlook released in October 2026, has increased growth projections for 2026 compared to July 2026 projections. The global economy estimates for 2027 are significantly better than 2026 projections due to improvement in Emerging & Developing Economies, despite lower projections for Advanced Economies. Middle East disruptions in energy sector and AI-induced investment boom are major factors impacting current year projections.

Indian Economic Scenario

Ministry of Statistics & Programme Implementation has updated GDP reporting from 2011-12 series to 2022-23 series. Annual estimates at constant prices for FY 2025-26 stand at 7.8% compared to 7.2% for FY 2024-25. On current prices, estimates for FY 2025-26 stand at 8.9% down from 9.7% for FY 2024-25.

Q1 FY27 GDP growth reached 10.3%. Major agencies have improved their growth projections:

  • IMF (Oct'26): 7.0% for both CY26 and CY27 (improved from 6.4% and 6.7% in July'26)
  • World Bank (Oct'26): 7.1% for FY27 (improved from 6.6% in April'26)
  • RBI (Oct'26): 7.1% for FY27 (improved from 6.7% in Aug'26)

Quarterly projections for FY27: Q2: 7.2%, Q3: 6.9%, Q4: 6.8%, Q1 FY28: 7.1%

IIP has shown improvement in all six categories during first five months of FY2026-27, driven mainly by Intermediate Goods, Capital Goods and Consumer Non-durables.

Global Steel Scenario

Global steel production has been declining annually except for marginal increase in 2023. First 8 months of CY26 saw production fall by 0.7% compared to corresponding period last year (CPLY), with China registering 3.1% degrowth while Rest of the World (RoW) showed 2.2% increase.

China dominates global production with ~53.2% share during Jan-Aug CY'26. Other major producers showing positive growth: Vietnam (29.1%), Turkey (6.8%), Germany (6.3%), India (6.0%), USA (5.5%), South Korea (2.8%). Negative growth seen in Russia (-5.1%), Brazil (-1.9%), Japan (-0.2%).

World Steel Association Short Range Outlook (Oct'26) projects:

  • Global steel demand to decrease by 0.1% in CY 2026 and increase by 1.7% in CY 2027
  • China demand expected to decline by 2% in CY 2026 and 1% in CY 2027
  • Global demand excluding China expected to grow 1.5% in CY 2026 and 4.0% in CY 2027
  • Major consuming nations CY 2026 growth projections: Vietnam (12%), India (7.9%), Germany (3.8%)
  • CY 2027 growth leaders: India (8.0%), Germany (6.0%), Vietnam (4.0%)

Indian Steel Scenario

Crude steel production in India grew 3% YoY in H1 FY'27 and 5% YoY in Q2 FY'27 (2% over previous quarter). Consumption grew ~8% during H1 over CPLY and 7% YoY in Q2 FY'27 (4% over previous quarter).

SAIL Operational Performance

Production Performance H1 FY'27
  • Crude Steel: 8.83 Million Tonnes (up 3% YoY)
  • Hot Metal: 9.35 Million Tonnes (up 3% YoY)
  • Saleable Steel: 8.32 Million Tonnes (up 3% YoY)
Sales Performance H1 FY'27
  • Total Sales: 8.51 Million Tonnes (up 6% YoY)
  • Domestic Sales: 8.11 Million Tonnes (up 6% YoY)
  • Export Sales: 0.40 Million Tonnes (up 5% YoY)
Techno-Economic Parameters H1 FY27
  • CDI Rate: 135 kg/thm
  • Specific Energy Consumption: 6.35 GCal/tcs
  • BF Productivity: 1.92 T/m3/Day

Financial Performance (INDAS Compliant figures)

H1 FY27 vs H1 FY26 (₹ Crore)
  • Sales Turnover: 57,776 (vs 52,254) - +10.6%
  • Total Income: 58,788 (vs 53,089) - +10.7%
  • EBITDA: 8,917 (vs 5,754) - +55.0%
  • Depreciation: 3,168 (vs 2,894) - +9.5%
  • Finance Cost: 1,016 (vs 1,079) - -5.8%
  • PBT Before Exceptional Items: 4,732 (vs 1,781) - +165.7%
  • Exceptional Items: -217 (vs -338)
  • PBT After Exceptional Items: 4,515 (vs 1,443) - +212.9%
  • Tax: 1,105 (vs 330) - +234.8%
  • Profit After Tax: 3,410 (vs 1,112) - +206.7%
Quarterly Performance (₹ Crore)
Q2 FY27 vs Q2 FY26
  • Sales Turnover: 31,766 (vs 26,524) - +19.8%
  • Total Income: 32,339 (vs 27,007) - +19.7%
  • EBITDA: 4,561 (vs 2,829) - +61.2%
  • Depreciation: 1,609 (vs 1,453) - +10.7%
  • Finance Cost: 523 (vs 484) - +8.1%
  • PBT Before Exceptional Items: 2,429 (vs 891) - +172.6%
  • Exceptional Items: -73 (vs -338)
  • PBT After Exceptional Items: 2,356 (vs 553) - +326.0%
  • Tax: 583 (vs 126) - +362.7%
  • Profit After Tax: 1,774 (vs 427) - +315.5%
Q2 FY27 vs Q1 FY27
  • Sales Turnover: 31,766 (vs 26,010) - +22.1%
  • Total Income: 32,339 (vs 26,449) - +22.3%
  • EBITDA: 4,561 (vs 4,356) - +4.7%
Financial Ratios

EBITDA Margin improved significantly in H1 FY27 compared to previous periods. EBITDA per ton showed substantial improvement.

Balance Sheet Metrics
  • Borrowings (Non IndAS): Showed management focus on debt reduction
  • Net Worth: Improved due to strong profitability
  • Interest costs reduced by 5.8% in H1 FY27 compared to H1 FY26

Abbreviations and Definitions

The presentation includes comprehensive list of standard steel industry abbreviations including BF (Blast Furnace), SMS (Steel Melting Shop), BOF (Basic Oxygen Furnace), EBITDA (Earnings Before Interest, Taxes, Depreciation & Amortization), PAT (Profit After Tax), and various plant codes (BSP, DSP, RSP, BSL, SSP, VISL, ASP).

Disclaimer

Statements/Data from external sources are considered reliable but SAIL cannot be held responsible for authenticity. Forward-looking statements are subject to various factors including economic conditions, government regulations, tax laws, and market conditions that may cause actual results to differ materially.