JINDALSTEL Q2 FY27 Earnings Call: Record Revenue Up 44% YoY, Net Debt/EBITDA Improves to 1.5x

JINDALSTEL held its Q2 FY27 earnings call on October 23, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Record Revenue on Volume and Mix, But Sequential Margin Pressure

• Record gross revenue of Rs.19,448 Cr (+44% YoY) — net revenue up 43% YoY to Rs.16,704 Cr, driven by record Q2 FY 2026-2027 sales volume of 2.38 MT and higher ASPs on a richer flats mix; domestic sales ~92% of total volume.
• Adjusted EBITDA of Rs.2,504 Cr (+34% YoY) — EBITDA/tonne up 5% YoY to Rs.10,529/tonne; sequential moderation attributed to higher raw material and operating costs despite better volume and mix.
• Consolidated PAT of Rs.771 Cr — down from Rs.844 Cr in Q1 FY 2026-2027.
• Coking coal was the key cost headwind — landed within the $12–15/ton guidance given on the previous call; power & fuel and ocean freight also rose sequentially, partly offset by better ASPs.
• Other expenses rose 13% QoQ — CFO Sandeep Modi attributed the jump primarily to higher freight (Middle East crisis, diesel price increase) and higher techno-economic consumption during the monsoon; guidance is that other expenses normalize in Q3 FY 2026-2027.
• Value-added mix at 57% — down from 66% in Q1 FY 2026-2027 on an apple-to-apple basis; MD V. R. Sharma noted the mix exceeds 65% when measured on the shift from low-price PMT to higher-price products.

TMT Cut, Flats Pivot, and a Seasonal Price Recovery Into Q3

• TMT output cut to 120,000 tons/month from 220,000 tons/month — ~100,000 tons redirected to flat products (plates and HR plates) amid weak TMT demand; TMT sales now confined to major projects with retail exposure curtailed.
• Q2 FY 2026-2027 price moves — TMT moved from Rs.52,000/t to Rs.59,000/t and HRC from Rs.51,000/t to Rs.60,000/t over the quarter; as of the call date, HRC spot is a little over Rs.60,000/t and TMT ~Rs.60,000/t.
• Q2 spot trajectory was volatile — TMT spot started the quarter at ~Rs.56,000/t, fell to Rs.45,000/t, and now stands around Rs.60,000/t; HRC spot moved from ~Rs.53,000–54,000/t to Rs.59,000/t by September.
• Management expects Q3 and Q4 FY 2026-2027 to be "much better" — citing festival season, strong building construction, good rains, and the late-Q2 HRC price strengthening flowing through in Q3 FY 2026-2027.
• Product mix target of 65-35 — 65% flat products (including plates) / 35% long, a shift from the earlier 50-50/55-45; management declined the 70-30 mix queried for FY 2027-2028, saying "we'll try to maintain 65-35, including plates."
• Plates leadership — over 220,000 tonnes/month across both locations as of Q2 FY 2026-2027; management credited Government of India spending on defense and merchant shipbuilding, with the windmill market "very hot" in India and outside India; the hot strip mill will produce only value-added grades, no vanilla products.

Coking Coal Inflation Ahead, Captive Inputs and Syngas as Offsets

• Coking coal cost inflation of $20–25/ton guided for Q3 FY 2026-2027 — confirmed by CFO Sandeep Modi and MD V. R. Sharma, separate from the West Asia conflict impact; management expects any further $10–15 variation can be absorbed with availability "not at all a problem."
• West Asia conflict impact of ~$4–5/ton — in both Q1 and Q2 FY 2026-2027 (diesel and related fuels); contained because the company imports only fuel from the region and switched to coal gasification; management is considering a possible additional $20/ton impact as a factor of safety if the conflict prolongs (period unspecified).
• Propane-to-syngas switch saving ~Rs.70/kg — propane at ~Rs.100/kg vs coal gas at Rs.30/kg; burners and automation permanently modified for syn gas, so the company committed to continuing with coal gas going forward.
• Captive coal meets ~50–55% of requirement — total captive availability ~15 MT across Raigarh and Angul; management is aiming for 65–70% (period unspecified) and stated it will meet its entire coal requirement from captive mines in FY 2027-2028, with the caveat that external purchases will be blended if they offer cost advantages.
• Captive coal delivers ~2% benefit at the SMS cost level — current benefit as of Q2 FY 2026-2027; Kasia iron ore consumption rose to 33% in Q2 FY 2026-2027 from 25% in Q1 FY 2026-2027, sustaining production during monsoon disruptions at OMC mines.
• Slurry pipeline delivers Rs.700/tonne freight saving — 192-km Badbil–Angul pipeline commissioned, eliminating at least 500 of 700+ trucks/day; commercial supplies start within 2–3 days of the call (late October 2026, Q3 FY 2026-2027) at 20,000 tons/day throughput.
• Industry sourcing shift cited — the Indian steel industry has reduced Australia coking coal exposure from 75–78% to about 50% as of the Q2 FY 2026-2027 call, diversifying toward Mozambique, South Africa, Colombia, Venezuela, America, Canada and now Russia.

DRI, Coal Gasification and Pellet Plant Timelines; Capex on Track

• 2 million ton DRI plant guided for commissioning by June 2027 (FY 2027-2028) — management flagged potential shipping-related delays for certain imported equipment but affirmed the June timeline stands.
• Coal gasification expansion — three more gasifiers of 35,000 NM3/hr each (total 105,000 NM3/hr) being installed, with gasifier and DRI commissioning targeted by June 2027 (Q1 FY 2027-2028) — management hedged the timeline ("hopefully"); ~95% of the plant is indigenous, one gasifier built in-house at the Rajapur Machinery Division and two at Godrej, Mumbai.
• Government benefits confirmed — management confirmed the company is receiving central government benefits for the DRI plant (coal-based and coal gas-based) and for coal gasification, but did not quantify the incentive or confirm inclusion under the Rs.37,500 crores government scheme cited by the analyst; the government is open to provide coal with exemption of 50% of royalty.
• New pellet plant on track — installation complete by March FY 2026-2027, trials end-March FY 2026-2027 or early April FY 2027-2028, commercial production expected by June FY 2027-2028; current pellet run-rate ~33,000 tons/day, 100% consumed in-house.
• Capex of Rs.1,228 Cr in Q2 FY 2026-2027 and Rs.3,187 Cr in H1 FY 2026-2027 — of the total Rs.47,000 crore plan, ~Rs.8,000–9,000 crore remains to be spent (period unspecified); FY 2026-2027 capex guidance maintained at Rs.7,500–10,000 crore with Rs.3,400 crore spent in H1 FY 2026-2027.
• Utkal B2 coal mine commissioning expected within FY 2026-2027 — the last mine yet to be commissioned is progressing through approvals with "no obstacle," though certain clearances remain with timing partly in the government's hands.

Deleveraging to 1.5x; JSOL Widening the Consolidated Gap

• Net debt declined Rs.1,141 Cr QoQ — from Rs.15,927 Cr at end-Q1 FY 2026-2027 to Rs.14,786 Cr at September-end; net debt/EBITDA improved from 1.71x to 1.51x; cash and equivalents at Rs.7,237 Cr.
• MD V. R. Sharma called 1.5x "one of the best" ratios in the industry — versus peers historically at 4x, 3x or 2.5x; the company is cash surplus as of Q2 FY 2026-2027.
• Consolidated-standalone gap driven by Jindal Steel Odisha Limited (100% subsidiary) — major projects commissioned at Jasol have put turnover and EBITDA on an increasing trend; the CFO expects the gap to widen in coming quarters (FY 2026-2027 onward) as JSOL's EBITDA and volumes keep increasing. No incremental amounts were quantified.
• Mozambique subsidiary posted better EBITDA YoY — vs Q2 FY 2025-2026, aided by better coal prices; its coking coal mines are delivering two vessels every month without fail.
• "Earn and invest" philosophy reiterated — management will not invest in new capacity until it reaches 100% capacity utilization, at which point it will review whether to expand (period unspecified).
• Manpower stable with no exodus — middle and upper-middle management (AGM to AVP levels) being elevated to higher responsibilities; management sees a positive atmosphere and no manpower shortage.

H2 Ramp-Up Targets, Trade Tailwinds, and Watch Items

• FY 2026-2027 volume guidance of ~10.5 MT sales / ~11 MT production — CFO guided that a saleable run-rate of 9–9.5 lakh tons/month over Q3–Q4 FY 2026-2027 is required to reach the lower end; management expressed confidence in landing mid-range, with H1 production at 4.79–4.8 MT and an H2 target of 6 MT (~0.96 MT/month).
• Record production expected in Q3 FY 2026-2027 — with Q4 FY 2026-2027 expected to surpass Q3 records; the new Angul blast furnace is targeted at ~10,500 tpd by end-October 2026, 11,000 tpd in November 2026 and 12,000 tpd in December 2026.
• Exports at ~100,000 tons/month — mainly HRC and plates, plus some rails and structures, as of the call (Q3 FY 2026-2027).
• EU trade opportunity cited — management noted Commerce Minister Piyush Goyal is negotiating with the EU on the basis of the FTA already signed and is hopeful the EU relaxes quotas and grants most-favored steel supplier status; Europe's steel deficit is ~28 million tons. CBAM remains an issue but management expects the EU Parliament and Government of India to find a solution.
• Angul water risk flagged by analyst Parthiv Jhonsa (Anand Rathi) — sanctioned Brahmani River draw of 59.1 billion liters annualized against a reservoir ~12.5% below normative level; MD V. R. Sharma responded that Angul uses only 31 MLD vs 59 MLD sanctioned and expects consumption at least 15% lower in FY 2027-2028, with no water shortage expected.
• Iron ore supply restored — NMDC supply was halted 27 days by a railway landslide (since restored) and OMC mines were waterlogged in Q2 FY 2026-2027; management expects no iron ore shortage in Q3 FY 2026-2027, with Roida mine right of way expected by end-December 2026/January 2027.
• Rs.1 lakh crore annual revenue ambition — management aims to reach it "as early as possible" (period unspecified), versus ~Rs.80,000 crore implied annualized run-rate from Q2 FY 2026-2027 sales.