JSW Steel expects strong demand to continue, says costs pressures will keep steel prices high

JSW Steel is seeing signs of strong demand from autos, specifically commercial vehicles (CVs) and passenger vehicles (PVs); solar appliances and infrastructure and also from bullet train segment, Seshagiri Rao, Joint MD and Group CFO, told CNBC-TV18.

Domestic steel major JSW Steel on Friday, January 21, reported a 69.2 percent year-on-year (YoY) jump in consolidated net profit at Rs 4,516 crore for the third quarter ended December 31, 2021.

“We are seeing a positive outlook from the auto sector. On quarter-on-quarter, steel supplied to the auto sector went up by 2 percent. Demand is picking up for commercial vehicles and passenger vehicles, but not in the light commercial vehicles and two-wheelers,” Rao said.

Talking about infrastructure, he said, “Metros and bullet trains projects are consuming steel. Therefore in Q4, on the consumption side, we see better growth than what we have seen in Q3FY22.”

According to him, costs pressures will keep steel prices elevated. However, signs of improvement in steel price are seen in the local market on long steel.

On coking coal price, Rao said, “Prices have gone over USD 400 per tonne; everyday prices are going up. We are seeing it going up by USD 15-20 every day. Therefore, it’s difficult to say this is the quantum of increase.”

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