India's SAIL posts third-quarter profit drop on soft prices, weak demand

Steel Authority of India

11/02/2025 15:58

Feb 11 (Reuters) - Steel Authority of India Ltd (SAIL)  SAIL.NS  reported a drop in third-quarter profit on
Tuesday, hurt by weak domestic demand and as prices of the key alloy were subdued amid an influx of cheap imports.
    The state-owned firm reported net profit of 1.26 billion Indian rupees ($14.5 million) in the three months ended
December 31, down from 3.31 billion rupees a year earlier. 
    Revenue rose a marginal 5% to 244.90 billion rupees.
    
    
    KEY CONTEXT
    Indian steelmakers, including JSW Steel  JSTL.NS , Jindal Steel  JNSP.NS  and Tata Steel  TISC.NS , have all reported
a hit in quarterly earnings due to lower demand and a continued decline in prices.
    Steel, used heavily in the construction and auto industries, saw continued challenges in demand due to lower
construction activity and project delays, while sustained influx of cheap imports from countries like China weighed on
prices.
    China, South Korea and Japan accounted for 79% of India's overall finished steel imports, which hit a seven-year high
in April-December.
    
    PEER COMPARISON 
    
                                  Valuation (next 12     Estimates (next 12      Analysts' sentiment              
                                  months)                months)                                                  
                      RIC         PE     EV/EBITDA       Revenue     Profit      Mean     No. of   Stock to       Div
                                                         growth (%)  growth (%)  rating*  analyst  price          yield
                                                                                          s        target**       (%)
 Steel Authority of    SAIL.NS    12.68  6.90            5.92        34.14       Sell     10       0.95           1.81
 India                                                                                                            
 JSW Steel             JSTL.NS    19.62  9.45            12.77       114.85      Hold     30       0.98           0.74
 Tata Steel            TISC.NS    16.38  7.29            8.22        191.77      Buy      30       0.89           2.60
 Jindal Steel And      JNSP.NS    12.96  7.29            17.78       38.08       Buy      26       0.85           0.24
 Power                                                                                                            
 
    
    * The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
    ** The ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading
above the PT
    
    OCTOBER-DECEMBER STOCK PERFORMANCE  
    
    -- All data from LSEG
    -- $1 = 86.7110  Indian rupees
    

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 (Reporting by Manvi Pant in Bengaluru; Editing by Varun H K and Leroy Leo)
 ((Manvi.Pant@thomsonreuters.com; +918447554364;))