Steel Authority of India (SAIL) Q1 24/25 earnings summary

Executive summary

• Q1 FY25 revenue from operations was ₹23,998 crore, with net profit at ₹10.68 crore, reflecting a significant decline from previous quarters due to lower steel prices and cheap imports.

• Crude steel production for Q1 FY25 was 4.683 million tonnes, and saleable steel production was 4.182 million tonnes.

• Domestic sales grew 5% year-over-year to 3.927 million tonnes, while exports declined to 0.086 million tonnes.

• Operational efficiency initiatives included reducing coal and coke consumption, improving product mix, and increasing use of conversion services.

• Exceptional items of ₹311.76 crore in Q1 FY25, mainly due to executive perquisites and contractual dispute settlements.

Financial highlights

• Turnover for Q1 FY25 was ₹23,764 crore, down from ₹27,744 crore in Q4 FY24 and ₹24,093 crore in Q1 FY24, impacted by lower price realization.

• EBITDA for Q1 FY25 was ₹2,420 crore, up 16% year-over-year but down from Q4 FY24.

• Net profit after tax for Q1 FY25 was ₹10.68 crore (standalone) and ₹81.78 crore (consolidated), both significantly lower than previous periods.

• Debt (Ind AS) stood at ₹41,381 crore, with a debt-equity ratio of 0.77.

• Finished and semi-finished steel inventory increased by ₹1,000 crore; finished product inventory at 1.84 million tonnes.

Outlook and guidance

• Domestic steel demand is expected to remain robust, driven by infrastructure investment and growth in steel-using sectors.

• Company targets crude steel production of 20.87 million tonnes and sales volume of 19.26 million tonnes for FY25.

• Coking coal costs expected to remain stable in Q2, with potential reduction in Q3 as inventory is liquidated.

• CapEx guidance: ₹6,300 crore for FY25, similar range for FY26; major CapEx ramp-up from FY27.

• Focus remains on increasing production volumes and addressing challenges from cheaper imports.