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Steel Boom: India Surges as China Falters
2 Nov
Summary
- India's steel production grew 5.6% y-o-y, outpacing China's 2.9% decline.
- SAIL's Q2 profit surged 315.4% due to strong flat product demand.
- JSW Steel reported record Q2 sales, driven by capacity expansion.
India's steel production has surged by 5.6% year-over-year to 130 million tonnes between January and September 2026, according to worldsteel.org. This growth positions India as one of the fastest-expanding steel producers globally, contrasting sharply with China, whose production fell by 2.9% during the same period. The slowdown in China is linked to a stagnant real estate sector, a key user industry.
In the September 2026 quarter, Steel Authority of India Limited (SAIL) reported a substantial 315.4% year-over-year increase in net profit, reaching Rs 1,773.7 crore. This surge was driven by strong demand for flat products, which constitute over 52% of its sales, and a 12.9% rise in realizations.
JSW Steel recorded its highest-ever consolidated sales volume in the quarter, growing 13% year-over-year to 7.46 million tonnes. The company's operational performance was bolstered by the ramp-up of its Vijayanagar facility in Karnataka. JSW Steel's net profit also saw a significant jump of 225.6% year-over-year to Rs 5,359 crore.
Despite strong performance, JSW Steel trades at a higher valuation multiple (P/E of 19.4) and return on equity (10.2%) compared to SAIL (P/E of 11.1, RoE of 6.6%). This valuation gap is partly attributed to SAIL's capacity remaining largely stagnant, while JSW Steel continues to expand aggressively.
