JSW Steel reported a larger-than-anticipated decline in its second-quarter profit, with net earnings plunging over 85% to ₹404 crore ($52.23 million) for the quarter ending June 30. This sharp drop was primarily driven by a surge in imports of cheap finished steel, which pressured domestic prices to multi-year lows amid weak demand.
Analysts had predicted a profit decline of 78%, according to LSEG data, making the actual drop even more significant. The influx of low-cost imports, particularly from China, followed by South Korea and Vietnam, has adversely affected local steel prices, prompting the steel ministry to support a temporary “safeguard duty” to mitigate Chinese imports. An investigation is also underway regarding certain products imported from Vietnam to assess their impact on the domestic industry.
During the quarter, domestic steel prices fell to their lowest levels in over three years, as reported by commodities consultancy BigMint. JSW Steel’s saleable steel sales decreased by 3.3% to 6.13 million tonnes, although production increased by 7% to 6.77 million tonnes.
Demand for steel remained weak due to above-average rainfall in India, which hampered activity in the infrastructure and automotive sectors—key markets for steel manufacturers.
The company’s revenue from operations fell 11% to ₹39,684 crore, missing analysts’ average estimate of ₹42,326 crore. Additionally, JSW Steel has revised its capital expenditure for the current fiscal year, lowering it to between ₹16,000 crore and ₹17,000 crore from an earlier projection of ₹20,000 crore.
Following the results, JSW Steel’s shares declined by 2.5%, continuing a downward trend from earlier in the session.