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Muted demand to weigh on JSW Steel in coming quarters

India covid-19 pandemic
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JSW Steel Ltd’s Q4 figures were weak as demand remained subdued, and the outlook may not be much better. The company maintained a flat sales outlook for FY21, but overall demand is likely to remain lacklustre in FY21.

While steel production dipped 5% year-on-year in Q4, sales tumbled 14% to 3.70 million tonnes. Domestic steel demand grew a tad due to a quarter-on-quarter increase in buying from the automotive industry.

While the management has maintained steel sale guidance of 15 million tons for FY21, analysts point out that growth has downside risks to it. “Sales volume guidance of 15mt for FY21 might be a tall order now, which was otherwise an easily achievable target, due to a possibility of the second wave of covid-19.

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