JSW Steel reported Q2 FY27 revenue of INR 545 billion, exceeding market expectations, driven by strong operational volumes. While Motilal Oswal maintained a buy rating, investors should note that input cost pressures have impacted profit margins. The company's financial results now reflect the de-consolidation of Bhushan Power and Steel, which makes year-on-year comparisons more complex.
JSW Steel announced its financial results for the second quarter of the fiscal year 2027, reporting revenue of INR 545 billion. This figure was notably higher than market expectations of INR 486 billion, marking a 31% increase compared to the same period last year and a 15% rise sequentially. The revenue growth was primarily supported by strong volume growth across the company's core operations.
Despite the revenue beat, the company faced some pressure on its profit margins. The adjusted EBITDA for the quarter stood at INR 99.4 billion. However, the adjusted EBITDA per tonne dropped by 11% on a quarterly basis. This decline was largely driven by higher coking coal prices and softer price realizations for steel in the market. For investors, these figures highlight the ongoing challenge of balancing volume growth with the volatility of raw material costs.
It is important for shareholders to note that JSW Steel's financial structure has changed following the de-consolidation of Bhushan Power and Steel Ltd (BPSL) as of March 2026. Because of this structural change, direct comparisons with last year's figures may not reflect the full picture without making pro-forma adjustments. Analysts at Motilal Oswal Financial Services noted that these adjustments are essential for accurately measuring the company’s current operational health.
Regarding valuation, the brokerage firm highlighted that JSW Steel currently trades at approximately 6.9 times its estimated FY28 enterprise value to EBITDA ratio. Motilal Oswal has maintained its earnings estimates for FY28 and reiterated a buy rating on the stock, with a target price of INR 1,460. The brokerage’s outlook remains tied to its confidence in the company’s long-term volume trajectory and operational scale.
Moving forward, investors may track whether the company can sustain its volume growth while managing the impact of fluctuating input costs and market prices. The ability to pass on raw material costs to customers or optimize production costs will be a key monitorable for the coming quarters.