Steel Authority of India Limited reported a robust start to FY27, with consolidated EBITDA rising more than 50% year-on-year to ₹4,356 crore in the quarter ended June 30, 2026. The sharp improvement in profitability was driven by better sales realizations and enhanced operational efficiencies, which offset the impact of higher input costs for coking coal and fuel. Despite a planned dip in production volumes due to advanced capital repairs at key plants, the company maintained stable borrowing levels and reduced its debt-equity ratio to a multi-year low of 0.36.

Financial Performance Highlights

The company’s net profit after tax (PAT) surged approximately 150% to ₹1,636 crore, compared to ₹685 crore in the corresponding quarter of the previous year (CPLY). Profit before tax (PBT) also witnessed significant growth, reaching ₹2,159 crore against ₹890 crore in CPLY. Sales turnover increased by over 1%, reflecting improved realization rates despite a 7% to 8% decline in sales volumes to 4.2 million tonnes. Crude steel production stood at 4.8 million tonnes, down slightly from 4.9 million tonnes in CPLY, as management strategically advanced major capital repairs at IISCO Steel Plant, Durgapur Steel Plant, and Bokaro Steel Plant to ensure smoother operations in subsequent quarters.

Estimated based on reported percentage decline.

Operational Insights and Cost Management

Chairman and Managing Director Dr. Ashok Panda highlighted that the EBITDA margin reached 16.7%, one of the highest levels since the peak steel market conditions of FY22. EBITDA per tonne crossed the benchmark of ₹10,000, standing at ₹10,464 per tonne. The company managed cash outflows effectively through treasury management, keeping borrowings at ₹21,729 crore as of June 30, 2026, nearly unchanged from the ₹21,663 crore recorded at the beginning of the fiscal year. The cost of debt decreased to 6.24% from 6.8% in CPLY, resulting in savings of approximately ₹100 crore in finance costs.

Input cost inflation remained a challenge, with imported coking coal prices averaging ₹21,300 per tonne in Q1FY27, up from ₹18,100 per tonne in Q4FY26. However, management expects a softening in coal prices during Q2FY27, anticipating a reduction of ₹1,000 to ₹2,000 per tonne progressively from August. Indigenous coal usage, currently at 15% of total consumption, is expected to increase from December 2026 onwards as production ramps up at the Tasra mines. The average price of indigenous coal was ₹13,100 per tonne compared to ₹21,200 per tonne for imported coal in Q1.

Mine Sales and Future Outlook

A notable contributor to this quarter’s performance was the increased focus on mine sales. Revenue from mine sales rose by ₹400 crore to ₹574 crore, generating an additional profit of ₹150 crore compared to CPLY. Volumes sold from captive mines reached 1.1 million tonnes, up from 0.31 million tonnes in the previous year. Management aims to double ore sales from the Odisha Group of Mines and initiate sales from Chhattisgarh and Jharkhand mines. The company has an inventory of 32 million tonnes of sub-grade fines and plans to auction 3 million tonnes in FY27.

Looking ahead, management maintains its full-year volume guidance, expecting growth over last year by year-end. While Q2 is traditionally challenging due to monsoon impacts, efforts are focused on preventing inventory buildup. Capital expenditure for FY27 is targeted at ₹15,000 crore, with plans to increase spending to over ₹20,000 crore in the following years to support expansion projects, including a new TMT bar mill at Durgapur expected to come online by late 2027.

Steel Authority of India witnessed a notable block trade on the National Stock Exchange (NSE), with approximately 1,134,064 shares changing hands at a price of ₹171.77 per share, aggregating to a total transaction value of ₹19.48 crores.

Block Trade Details

The following table summarizes the key parameters of the block trade recorded on the NSE:

Block trades of this scale are typically associated with institutional investors or large market participants executing significant position changes outside the regular order book, and represent a meaningful volume event in the stock's trading activity.