Steel Authority of India Limited (SAIL) reported its Q2 and H1 FY27 results on October 28, 2026, showing a sharp improvement in profitability and a further reduction in debt. Shares fell during the session amid investor concerns over margin pressure and a downward revision to sales volume guidance. According to SAIL's results presentation, as reported by Investing.com, profit after tax for the first half reached Rs 3,410 crore, up 207% year-over-year.
In the second quarter, sales turnover rose to Rs 31,766 crore, up about 20% from Rs 26,524 crore in Q2 FY26 and up 22% sequentially from Q1 FY27. EBITDA reached Rs 4,561 crore, compared with Rs 2,829 crore a year earlier. Profit after tax surged 315% year-over-year to Rs 1,774 crore from Rs 427 crore, and increased 8% from Rs 1,636 crore in the previous quarter.
For the first half of FY27, SAIL reported sales turnover of Rs 57,776 crore and revenue from operations of Rs 58,243 crore. EBITDA stood at Rs 8,917 crore, which the presentation puts at a 15.43% margin. Profit before tax was Rs 4,515 crore, earnings per share were 8.25, and net worth increased to Rs 60,329 crore.
On the operational side, SAIL produced 9.6 million tonnes of crude steel and 8.4 million tonnes of saleable steel in H1 FY27, according to the presentation. Total sales for the first half were 9.3 million tonnes. Q2 FY27 sales volumes were 5.2 million tonnes, compared with 4.9 million tonnes in Q2 FY26.
SAIL's balance sheet improved markedly. Borrowings declined from Rs 29,811 crore in March 2025 to Rs 20,583 crore by September 2026, a reduction of more than Rs 9,200 crore. Over the same period, net worth rose from Rs 55,656 crore to Rs 60,329 crore, and the debt-equity ratio fell from 0.54 times to 0.34 times.
Quarterly interest expenses declined from Rs 664 crore in March 2025 to Rs 523 crore in September 2026. For H1 FY27, the company reported a debt service coverage ratio of 2.64 and an interest coverage ratio of 4.89. India's steel market showed relative resilience.
Indian crude steel production grew 3% in H1 FY27 to 85.1 million tonnes, while finished steel consumption rose 8% to 84.9 million tonnes. Q2 FY27 consumption reached 43.4 million tonnes, up 7% year-over-year and 4% sequentially, according to the presentation. Globally, world crude steel production totaled 1,225 million tonnes in January-August 2026, down 0.7% from the prior-year period.
China's output fell 3.1% to 652 million tonnes, while production in the rest of the world rose 2.2% to 573 million tonnes. The World Steel Association's October 2026 outlook, cited in the presentation, projects global apparent steel consumption to contract 0.1% in 2026 to 1,722 million tonnes before rising 1.7% in 2027 to 1,752 million tonnes. Demand excluding China is expected to grow 1.5% in 2026 and 4.0% in 2027.
India is projected to lead major economies with growth of 7.9% in 2026 and 8.0% in 2027. The presentation also reported domestic market prices from August to October 2026. Hot rolled coil (HRC) ex-Delhi approached Rs 75,000 per tonne, cold rolled coil (CRC) exceeded Rs 60,000 per tonne, and rebar ex-Delhi reached approximately Rs 65,000 per tonne.
These are market reference prices and should not be confused with SAIL's own realizations. Separately, SAIL's October pricing data showed long products at Rs 58,700 per tonne and flat products at Rs 61,700 per tonne, which the company noted were approximately Rs 4,000 per tonne above its Q2 averages. Cost pressures remained a central issue.
According to the earnings call transcript cited by Investing.com, imported coking coal costs reached Rs 22,930 per tonne in Q2, and management indicated costs could remain in the Rs 22,000-23,000 range. Iron ore pellet costs also rose significantly in recent months, according to the presentation. Higher input costs partially offset the benefit of improved sales realization during the year.
On guidance, the earnings call transcript indicates that management revised its FY27 sales volume guidance to 21 million tonnes from 22 million tonnes, citing the current sales pace. The company also outlined a four-year capital expenditure programme totaling Rs 1,20,000 crore, including Rs 15,000 crore in FY27, over Rs 20,000 crore in FY28, and Rs 25,000 crore in FY29. Management emphasized funding the programme through improved internal accruals and profitability.
Several developments were presented as supportive of the outlook. Management expects the Tasra coking coal mine to begin production in January 2027, which could reduce reliance on expensive imported coal. Iron ore sales expanded to 2.46 million tonnes in H1 FY27, generating a profit of Rs 388 crore compared with Rs 124 crore a year earlier, and the company targets 7-8 million tonnes of iron ore sales in FY27.
Management also noted that Q3 and Q4 are typically the strongest quarters for the steel business, with pricing expected to improve after the monsoon season. The share price reaction was negative despite the strong results. Live market data cited by Investing.com showed shares down about 4.5% in the session, while the closing quote for the stock was INR 162.00, a decline of 5.37%.
The market appears to be weighing the revised volume guidance, elevated coking coal costs, and the scale of planned investment against the strong H1 earnings and deleveraging. Source: Investing.com, 'SAIL Q2 FY'27 slides: profit surges 315% as debt falls, shares drop 4%', published October 28, 2026. Figures attributed to SAIL's Q2 and H1 FY27 results presentation, the earnings call transcript, and the World Steel Association's October 2026 outlook, as reported by Investing.com.
The original article states it was generated with AI support and reviewed by an editor.
Source: ng.investing.com