India: SAIL posts record crude steel production, sales in FY23

PSU steel major, Steel Authority of India Limited (SAIL), has posted its best ever crude steel production and sales volumes in financial year 2022-23 (FY'23). The company has projected sales guidance of 18.7 million tonnes (mnt) for FY'24.

The steel behemoth has capex plans of around INR 6,500 crore for FY'24 and around INR 1,00,000 crore till FY31-32.

Other highlights

• Best ever crude steel output: The company has recorded its best ever annual crude steel production of 18.3 mnt in FY'23, up 5% y-o-y against 17.4 mnt in FY22. Similarly, output rose by 5% q-o-q to 5 mnt in Q4FY23 against 4.7 mnt in last quarter.
  
  
• Best ever steel sales: Sales remained marginally stable y-o-y at 16.2 mnt in FY'23 compared with 16.15 mnt last fiscal. However, sales volumes increased by 12% q-o-q to 4.7 mnt in Q4FY'23 as against 4.2 mnt in the previous quarter. Sales edged higher due to relatively higher realisations in FY'23. However, Export volumes declined to 0.4 mnt in FY'23 as against 1.4 mnt in FY'22.
  
  
• EBITDA declines y-o-y: The company's Earnings Before Interests, Taxes, Depreciation and Amortisation (EBITDA) stood at INR 9,379 crores in FY23, registering a decline of 58% y-o-y compared with INR 22,364 crore seen in the year-ago period. However, the same rose by 55% q-o-q to INR 3,401 crore in Q4FY23 against INR 2,198 crore in Q3.
  
  
• PAT drops q-o-q: The steel major posted profit after tax (PAT) of INR 1,903 crore during the financial year, down by 84% y-o-y against INR 12,015 in previous fiscal. However, the same showed a whopping growth of 126% q-o-q to INR 1,049 crore in Q4FY23 against INR 464 crore in Q3. Profitability had been impacted due to high input costs majorly imported coking coal and foreign exchange variation loss.
  
  
• Net sales realisations (NSR) up q-o-q: NSR for long products rose by INR 2,000/t q-o-q in Q4 and that of flat products increased by INR 2,700/t during the period.
  
  
• Coking coal costs: The imported coking coal costs remained flat q-o-q at INR 25,500/t in Q4FY23. Furthermore, it is projected to be higher at around INR 28,000/t in Q1FY24.
  
  
• Inventory: Inventory levels held with the company stood at 1.05 mnt as on 31 March 2023. Steel stocks have increased by 4,50,000 t y-o-y in FY23.
  
  
• Capacity expansion: The steel major will be ramping up some of its facilities and expand capacities. It has plans to expand capacity at IISCO Burnpur by 4.5, Bokaro Steel Plant by 3 mnt and then further at Durgapur Steel Plant also. Furthermore, it aims to achieve 31 mnt by FY30-31.