Mumbai: Steel Authority of India Limited (SAIL) hosted its earnings conference call today, following the announcement of its third-quarter results for FY26. The call, led by Director (Finance) Mr. Ashok Panda, highlighted a period of strong financial performance, strategic inventory management, and a bullish outlook driven by domestic demand and planned expansions.
Financial Performance & Operational Highlights
SAIL reported a significant 60% year-on-year increase in Profit After Tax (PAT) for the nine months ending December 2025. This surge is attributed to enhanced operational efficiency, aggressive inventory liquidation, and stringent cost optimization measures.
Key operational metrics include:
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Crude steel production grew by 2% to 14.35 million tonnes (MT).
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Sales volume witnessed a substantial jump of 16.3%, leading to a notable reduction in inventory and borrowings.
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The company reduced its net debt by approximately ₹5,000 crore during the nine-month period, with an additional ₹2,000 crore reduction in January alone.
Market Dynamics and Pricing Power
Mr. Panda noted that the Indian steel industry is experiencing robust demand, with consumption growing by 7% year-on-year. India has transitioned back to being a net exporter of steel. After a subdued period, domestic steel prices began firming up from mid-December 2025.
The management disclosed significant price increases:
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Long Products: Prices increased by ₹2,000-₹2,500 per tonne in January.
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Flat Products: Prices increased by ₹3,300-₹3,500 per tonne in January.
Furthermore, Mr. Panda indicated that the full effect of tranche-based hikes initiated in January will be realized in February's sales realizations, suggesting further upward price momentum in Q4 FY26.
Coking Coal Cost Impact and Inventory Gains
Addressing a key concern, Mr. Panda clarified the impact of volatile coking coal prices. After an inventory write-down of nearly ₹1,000 crore in Q1 due to falling prices, the company saw a marginal positive impact (approx. ₹100 crore) in Q3. With current spot prices around $251 per tonne, a more substantial positive inventory valuation gain is anticipated in Q4, potentially boosting profitability.
Major Expansion: The ₹36,000 Crore IISCO Project
A central theme of the call was SAIL's growth trajectory. The management provided details on the massive ₹36,000 crore expansion plan at IISCO (Indian Iron & Steel Company). Most major packages have been ordered, and ground activity has commenced, with completion expected in about three years.
Mr. Panda projected that post-expansion, the new facilities could generate an EBITDA per tonne exceeding ₹10,000, a significant uplift from the current levels of ₹6,000-₹7,000. To accommodate this expansionary Capex, SAIL is proactively reducing its working capital debt. The Capex guidance for FY27 is set at ₹15,000 crore, a sharp increase from the FY26 estimate of ₹7,500-₹10,000 crore.
Other Strategic Updates
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Product Mix Improvement: SAIL is focused on reducing semi-finished steel (semis) sales, currently at 10% of product mix. A new 1 MT TMT Bar Mill at Durgapur Steel Plant, slated for commissioning in 18 months, is expected to bring semis contribution "very close to zero."
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NSL (NMDC Steel Limited) Volumes: SAIL sold 1 MT of NSL-produced steel in 9M FY26, maintaining price parity with its own products, primarily in the southern market.
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Operational Setbacks: The company addressed recent incidents at Bokaro and Bhilai plants, confirming that operations have now normalized and are running at full capacity, with no significant spillover impact expected in Q4.
Outlook for Q4 and Beyond
Mr. Panda expressed strong optimism for the fourth quarter, traditionally the best for the steel industry. He expects continued momentum in sales volume, price realizations, and further debt reduction. The management is targeting a hot metal production of 22.5 MT in FY27, up from an estimated 20.5-21 MT in FY26.
SAIL's Q3 performance underscores a strategic focus on financial discipline, market agility, and long-term capacity building to capitalize on India's growing steel demand.