SAIL to share Q1 results today: A muted show likely, say brokerages

SAIL is expected to report a muted set of June quarter results later today. All eyes would be on the management guidance on FY24 crude steel production, de-bottlenecking programme and timelines, SAIL's handling of key input costs and a debt reduction roadmap. Guidance on domestic and international steel prices, and capex, will also be critical, analysts said. While SAIL is expected to report muted growth in revenues, analyst projections on its profitability differ largely.

Phillip Capital sees profit falling 99 per cent to Rs 9.30 crore against Rs 776.33 crore in the year-ago quarter. It sees revenue falling 1 per cent YoY to Rs 23,735 crore. Kotak Institutional Equities sees profit falling 66 per cent YoY to Rs 259.50 crore. This brokerage sees revenue rising 0.5 per cent YoY to Rs 23,662 crore.

Kotak Institutional Equities expects steel realisation to decline 2.1 per cent QoQ  (down 19 per cent YoY) led by price cuts during the quarter.  "We expect standalone Ebitda per tonne to decline 28 per cent QoQ  (down 33 per cent YoY) to Rs 7,890 per tonne led by lower realisations and high-cost coking coal inventory," Kotak said.

ICICI Securities expects SAIL to report a loss of Rs 350 crore for the quarter amid a 2 per cent drop in sales at Rs 23,565 crore. It said realisation could be lower by Rs 1,500 per tonne sequentially. It said coking coal cost may rise  Rs 1,800 per tonne QoQ and raw material cost to escalate following inventory evaluation. It expects a debt escalation of Rs 3,500 crore.

Motilal Oswal, meanwhile, sees profit for SAIL rising 8.8 per cent for the quarter to Rs 844.90 crore. It sees consolidated sales rising 11.8 per cent YoY to Rs 26,820 crore. YES Securities said it expects margins for SAIL to fall on account of the macro-economic and high-cost raw material utilisation issues. On a YoY basis, it sees SAIL to increase its production levels based on the company's focus to expand utilisation levels at its current plants and by removing bottlenecks. However, a falling steel price and high costs would cause a dent to the company's earnings. It sees profit falling 22.3 per cent YoY to Rs 556.30 crore. It sees revenue falling 5.1 per cent to Rs 22,792 crore.

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