JSW Steel Q4 Result Review: Volume Growth Intact, Margin Expansion To Continue, Says Systematix— Maintains Buy

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Systematix Report

JSW Steel Ltd.’s Q4 FY25 consolidated adjusted Ebitda of Rs 63.8 billion (+4.1%/+14.3% YoY/QoQ) was 19% above our estimate due to higher realisations and better than expected performance at overseas operations. Consoldiated revenue for the quarter was reported at Rs 448.2 billion (-3.1%/+8.3% YoY/QoQ).

Standalone revenue of Rs 324 billion was in line, and Ebitda of Rs 50.6 billion was 9% above our estimate. JSW Steel reported crude steel production of 7.6 mt this quarter, registering 12.4%/8.5% YoY/QoQ growth as new capacities at Bhushan Power & Steel Ltd. and Jindal Vijayanagar Metallics Ltd. ramped up during the quarter.

Steel realisations averaged Rs 59,838/t (-13%/-3% YoY/QoQ) in Q4 FY25. Value-added special products increased by 2%/5% YoY/QoQ in Q4 with a 60% share in total sales.

The company incurred ~Rs 146 billion capex in FY25 and with a closing net debt of Rs 765 billion, declining by Rs 44 billion QoQ.

We maintain Buy rating on the stock based on 8.5x FY27E EV/Ebitda with a revised target price of Rs 1,233/share (Rs 1,091/share earlier), implying 22% upside from the current market price. JSW Steel currently trades at 8.8x and 7.3x FY26E and FY27E forward EV/Ebitda.

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