JSW Steel Q3 Results Preview: Revenue and Profit Growth Expected

Introduction

JSW Steel, a key player in India's metals and mining sector, is scheduled to announce its financial results for the third quarter of fiscal year 2026 on January 23. The announcement comes amid a mixed environment for ferrous metal companies, which are grappling with fluctuating steel prices and rising input costs. Despite these headwinds, market analysts anticipate a positive performance from JSW Steel, projecting growth in both revenue and profitability on a year-over-year basis. Investors and market watchers will be closely examining the company's operational metrics, margin performance, and management commentary for insights into the demand outlook and cost dynamics for the upcoming quarters.

Analyst Expectations for Q3 FY26

Financial analysts have set specific expectations for JSW Steel's third-quarter performance. Revenue is projected to be around ₹41,378 crore, marking a 4.27% increase compared to the same period last year. The most significant growth is anticipated in the bottom line, with Profit After Tax (PAT) expected to surge by 63.33% year-over-year to ₹717 crore. Early estimates also suggest that Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) could rise to approximately ₹3,140 crore. These forecasts are underpinned by expectations of steady sales volumes, even as the company navigates a challenging price environment.

Production Performance and Operational Updates

Ahead of its full financial disclosure, JSW Steel released its production figures for the third quarter. The company reported a consolidated crude steel production of 7.48 million tonnes, a 6% increase year-over-year. However, this figure represents a 5% decline on a sequential basis, down from 7.90 million tonnes in Q2 FY26. The sequential dip was attributed to the planned shutdown of Blast Furnace-3 (BF3) at its flagship Vijayanagar plant for an upgrade. This temporary shutdown impacted capacity utilisation, which stood at 85% for its Indian operations during the quarter. Excluding the impact of BF3, the utilisation was a healthier 93%. The company has confirmed that the upgraded blast furnace is expected to be commissioned by the end of Q4 FY26, which should help restore production volumes.

Key Factors Under Scrutiny

Investors will be looking beyond the headline numbers to assess the underlying health of the business. Several key factors will be in focus during the results announcement and subsequent investor calls.

• Steel Realisations and Margins: The impact of domestic and international steel price trends on the company's blended realisations will be critical. Ongoing pressure from imports and price erosion has been a concern for the sector, and JSW Steel's ability to protect its EBITDA per tonne will be closely monitored.
• Cost Dynamics: Trends in key input costs, particularly for coking coal and iron ore, will significantly influence operating margins. The extent to which the company has utilized its captive raw material sources to mitigate these cost pressures will be a key point of analysis.
• Volume Growth and Exports: While production was sequentially lower, the company's sales volume figures will provide insight into underlying demand. Additionally, the performance of its overseas operations in the USA and Italy, along with the contribution from exports, will be important indicators of its standing in the global market.

A Deeper Look at Analyst Forecasts

While initial estimates point to moderate EBITDA growth, some brokerage firms offer a more detailed perspective. Emkay Research, for instance, projects a consolidated Q3 EBITDA of ₹6,300 crore (₹63.0 billion). This figure, while representing a 13% year-over-year increase, would be an 11.4% decline from the previous quarter. Emkay attributes this expected sequential contraction to lower steel realisations and higher coking coal costs, which are anticipated to compress EBITDA spreads by approximately ₹1,300 per tonne. This nuanced view highlights the margin pressure faced by steel producers despite healthy demand.

Stock Performance Review

JSW Steel's stock has seen varied performance over different time horizons. As of January 22, 2026, the share was trading at ₹897.65. Over the past six months, the stock has delivered a return of 6.56%. However, looking at the past year, the share price has decreased by 7.31%. The long-term performance has been relatively flat, with the stock providing a 0.54% return over the last five years. This performance reflects the cyclical nature of the steel industry and the macroeconomic factors influencing it.

Broader Sector Outlook

The metals and mining sector is presenting a picture of diverging trends in Q3 FY26. Non-ferrous metal companies like Vedanta and Hindalco are expected to benefit from a surge in global commodity prices. In contrast, ferrous companies are facing a more challenging environment. While JSW Steel and Tata Steel are expected to outperform within the steel space due to operational efficiencies and a strong domestic focus, others like Steel Authority of India (SAIL) may see profitability come under pressure due to the decline in steel prices during the quarter.

Summary of Q3 FY26 Expectations

Conclusion

JSW Steel is poised to report year-over-year growth in its Q3 FY26 results, driven by resilient demand and higher production compared to the previous year. However, the company faces significant headwinds from margin pressures due to lower steel prices and elevated input costs, as reflected in the expected sequential decline in EBITDA. Investors will be keenly awaiting management's commentary on the demand outlook, cost control measures, and the timeline for ramping up production at the upgraded Vijayanagar facility. The results will provide a clearer picture of how one of India's leading steelmakers is navigating the complexities of the current market.