About Jayant Acharya
Jayant Acharya, Joint Managing Director and CEO of JSW Steel, discussed the company's first-quarter performance for fiscal year 2027 in media appearances. He reported record sales and described the quarter as having "very strong operational performance." Acharya attributed the results to robust domestic steel demand, which he said grew at 8.3%, and a 15% quarter-on-quarter volume growth. He noted that capacity utilization, excluding the BF3 furnace, stood at 94%. Acharya stated that net debt to EBITDA improved to 1.46 from the previous quarter, with net debt reduced to approximately 46,000 crore rupees. He said the company's comfort level is to maintain the ratio below 2.5 as it expands capacity toward a target of 62 million tons.
Looking ahead, Acharya said the July-September monsoon quarter typically brings seasonal impacts, but he expected "better traction in terms of demand and prices" in the second half of the year. He indicated that Q2 would see increased volumes from the ramp-up of the BF3 furnace at Vijayanagar and from JSW Steel's Ohio operations in the U.S. Regarding costs, Acharya said cooking coal would impact expenses to some extent but that iron ore prices have started reducing. He said he could not provide a specific EBITDA band for the next quarter due to difficulty in estimating prices. On expansion strategy, Acharya stated the company's focus is on brownfield growth and the Paradip greenfield project, and that it would only consider other assets if they are "really so attractive."
Source: AI-verified profile updated from Jayant Acharya's recent appearances.
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Transcript (8 segments)
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Interviewer0:00
All right, we have with us Mr. Jayant Acharya of JSW Steel. Good set of numbers there. What were the key drivers, Jayant, for the quarter?
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Jayant Acharya0:10
Yeah, thank you. Happy to be here. I think JSW Steel had a very transformational year in FY26. It was marked by a strong operational performance. In addition to that, we concluded our strategic joint venture with JFE Steel, and we completed it as per schedule at end March. We also signed the joint venture with POSCO last month for an integrated steel plant in Odisha. Our focus on capacity expansion also began last year aggressively. We have also ramped up our operations in our JBML asset. In addition to that, we have enhanced our raw material security through the acquisition of the Mozambique coal mine, and we have significantly strengthened our balance sheet and reduced our leverage. So this provides the foundation for accelerating our growth in line with the India demand.
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Interviewer1:15
Right. So lots of things have really moved in the last financial year, but in this financial year, Jayant, of course things are very different and the world order has also changed in terms of the price. Of course, the spread of domestic steel price has really increased and you've been a beneficiary of the pricing as well. Give me a sense of how the raw material costs as well as the price realizations are really working out for steel for the present quarter.
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Jayant Acharya1:49
So in quarter 4, the prices saw an uptick. We have to keep in mind that in December, the prices saw a six-year low, and the prices started picking up in the seasonally better quarter in January-March and also post the imposition of the final safeguard duty at end December. We have seen good price uptake on the back of seasonal demand and international pricing as well, which were positive. Part of the price advantage has come in quarter 4, and part of the price will come in quarter 1. Our costs have also gone up, especially on coking coal. Coking coal has gone up on a quarter-to-quarter basis by $16. Other costs have also moved up. The rupee depreciation has also impacted costs. We will also see higher cost playing out in quarter 1, which would, I think, our expectations are that the pricing would cover the cost and would give us some additional margin over quarter 4 in quarter 1.
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Interviewer3:00
All right. So the last bit that you mentioned, can you highlight more on that? Jayant, I want to understand, of course, rupee depreciation, you are paying more rupees for buying the same amount of coking coal in terms of the forex movement, but in terms of the price, of course, if it has gone up, and on the ground now, the raw material prices when it comes to also the iron ore and steel, now how is this dynamic working out in terms of offsetting the higher cost impact of coking coal as well as the rupee depreciation?
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Jayant Acharya3:42
Yeah. So the rupee depreciation on all our imports, naturally including coking coal, has impacted us. The rupee depreciated by almost 11% in the last year, and that's a cost impact for sure. In addition to that, we are seeing iron ore prices which have also moved up in the last month and the previous weeks, that would also flow into quarter 1. So we would see a cost increase in this quarter. Our estimation is that probably costs will go up by maybe close to 3,000 rupees or 3,500 rupees per ton in addition to the costs which have gone up in quarter 4. However, some part of that would be mitigated by the price. The full quarter price advantage will play out in quarter 1, right? Because prices increased in January, February, and March, but the full advantage of that will play out in quarter 1. So that would offset the cost and give us some additional margin over quarter 4.
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Interviewer4:51
All right. So are you saying that despite higher costs of raw material and rupee depreciation, offset by the higher steel prices which you're going to realize, you will be able to improve margins, EBITDA margins over around 17% that you have clocked in? Give us a guidance on that and other operational efficiencies.
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Jayant Acharya5:13
It can be difficult to give a guidance because, as you know, the geopolitical situation continues to remain very volatile. While this is what we are expecting, we never know what may happen. But I'll give you the positives the way I see it. The India demand continues to be very strong. Last year we ended the year with 164 million tons of demand. We expect probably a growth in the range of 7 to 9%, incrementally maybe another 12 to 14 million tons of demand. From that perspective, we are very well placed to meet that demand with our additional capacities from JVML and the blast furnace 3, for which the capacity augmentation is going on in Vijayanagar. So we would be able to add at least another 3 million to 3.5 million tons in this year from a production perspective, and that would actually add to the operational leverage numbers. That's the direction we are taking, and I think we are quite optimistic that the India trajectory, we believe we are quite convinced about the long-term growth of India, and therefore we are keeping our focus on India in terms of our capacity expansions.
