JSW Steel share price slipped 2 percent intraday to Rs 666 on January 21, with the steelmaker set to announce its December quarter earnings later in the day.
JSW Steel is expected to report a 113 percent year-on-year growth in consolidated net profit to Rs 5,719 crore for the quarter ended December, according to an average of estimates by five brokerage firms polled by Moneycontrol.
The steel producer’s performance will be boosted by the significant improvement in price realisation as compared to the year-ago quarter. Brokerage firm Prabhudas Lilladher expects realisation per tonne to rise 52 percent on-year to Rs 75,204, whereas operating profit per tonne is seen higher by 37.1 percent.
The benefits of the price hikes undertaken by the company over the past few quarters would be reflected in the operating performance too.
The company’s consolidated operating profit is expected to rise 68 percent on-year to Rs 9,996 crore in the December quarter, the poll showed.
Analysts expect the company’s consolidated operating margin to expand 70-427 basis points on-year to 27.8-31.5 percent in the reporting quarter.
On a sequential basis, JSW Steel’s consolidated operating margin is likely to shrink 57-580 basis points, reflecting the impact of higher input costs and slower price hikes.
Sequentially, the company’s operating profit a tonne is also expected to decline 18.6 percent to Rs 22,370 crore, brokerage firm Motilal Oswal Financial Services said in a preview note.
“We expect the raw material cost to increase sequentially with an increase coking coal costs offset by lower iron ore prices factoring a one-month consumption lag,” Kotak Institutional Equities said in a preview note.
At 12.25 pm, JSW Steel was quoting at Rs 671, down Rs 11.45, or 1.68 percent, on the BSE. The share touched a 52-week high of Rs 776.50 on August 6, 2021 and a 52-week low of Rs 356 on February 1, 2021.It is trading 13.5 percent below its 52-week high and 88.67 percent above its 52-week low.