JSW Steel shares trade higher despite ₹1,473 crore demand notice by Odisha Govt

JSW Steel had earlier surrendered the Jajang block in December 2024, citing uneconomic operations, with mining activities having ceased at the site. Responding to the development, the company stated, “the company believes due legal process has been followed and that it will take appropriate legal remedies against the demand notice in consultation with its legal advisors.”

The announcement weighed on the stock, which closed at ₹1,054.60 on Friday, down ₹17.2 from its previous close on the National Stock Exchange (NSE). The company’s market capitalisation also fell to ₹2,58,000 crore. The stock opened at ₹1,052.30 on Monday, August 25 and is currently trading 0.22% higher at ₹1,056.90 apiece on the NSE at 12:03 PM.

The demand notice adds a regulatory challenge to JSW Steel’s operations, with the company preparing to evaluate its legal options in response.

JSW Steel reported consolidated net profit of ₹2,184 crore in the first quarter of the current financial year, marking an upside of 158% from ₹845 crore in the same period last year. The sharp jump in profit came on the back of strong domestic steel demand aided by healthy capex by the government in June quarter.

JSW Steel's revenue from operations rose 0.5% to ₹43,147 crore in June quarter as against ₹42,943 crore in the year-ago period.

The Mumbai-based company reported strong operational performance as its earnings before interest, taxes, depreciation, and amortisation (EBITDA) also known as operating profit jumped 38% to ₹7,576 crore from ₹5,510 crore. Its operating profit margin expanded by 470 basis points (bps) in June quarter to 17.56%.

During the quarter, consolidated crude steel production rose 14% year-on-year (YoY) to 7.26 million tonnes, while steel sales grew 9% YoY to 6.69 million tonnes, supported by a 12% YoY increase in both institutional and retail sales, the company said in a press release.

Crude steel production from JSW’s domestic operations came in at 7.02 million tonnes, up 15% YoY, while sales rose 9% to 6.43 million tonnes. Domestic sales stood at 5.96 million tonnes, registering 12% growth and accounting for the bulk of the company’s offtake, the company added.

However, exports fell 20% comprising 7% of Indian sales, reflecting subdued global demand. Capacity utilisation at Indian plants stood at 87%, lower than 93% in Q4 FY25, due to scheduled maintenance.