Jindal Steel & Power Limited (NSE: JINDALSTEL) Q3 2026 Earnings Call dated Jan. 31, 2026
Corporate Participants:
Vishal Chandak — Head of Investor Relations
Gautam Malhotra — Chief Executive Officer
Sushil Pradhan — Head of Sales and Marketing and Executive Vice President
Sunil Agrawal — Chief Financial Officer
Analysts:
Prateek Singh — Analyst
Vikas Singh — Analyst
Parthiv Jhonsa — Analyst
Amit Murarka — Analyst
Sumangal Nevatia — Analyst
Jashandeep Singh Chadha — Analyst
Rahul Gupta — Analyst
Tushar Chaudhari — Analyst
Pallav Agarwal — Analyst
Ashish Kejriwal — Analyst
Siddharth Gadekar — Analyst
Kamlesh Bagmar — Analyst
Raashi Chopra — Analyst
Ritesh Shah — Analyst
Rajesh Majumdar — Analyst
Presentation:
operator
Ladies and gentlemen, Good day and welcome to the Jindal Steel Limited Q3FY26 earnings conference call hosted by IIFL Capital Service Limited as a reminder all participants lined will be in listen only mode and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call please signal an operator by pressing 0 on your Touchstone 4. Please note that this conference is being recorded.
I now hand over the conference to Mr. Prateek Singh from IIFL Capital. Thank you. And over to you sir.
Prateek Singh — Analyst
Thank you Pari. Good afternoon everyone and welcome to the third quarter FY26 earnings call of Jindal Steel Limited. Without further ado I will now hand over the call to Mr. Vishal Chandak Head Investor Relations and Strategic Finance to introduce the management attendees and take it forward. Over to you Vishal.
Vishal Chandak — Head of Investor Relations
Hi Prateek. Thank you very much. Thank you very much ladies and gentlemen and appreciate you coming over a weekend. I once again welcome you to the Q3FY26 earnings briefing of Jindal Steel. We have with the senior management of the company Mr. Gautam Malhotra CEO Mr. Saby Sachi Bandapadya hold time director Mr. Pankaj Malhan, executive director Angul Mr. Sunil Agarwal, CFO and Mr. Sushil Pradhan head flat products. I request all the participants to ask questions which are strategic in nature and for any factual related queries we are always there to help you out. Without much ado I will hand over the floor to our CEO Mr. Gautam. We also have our overtime director Mr. Damutar Mittal as well on the line. Over to you Gautam sir.
Gautam Malhotra — Chief Executive Officer
Thank you Vishal. Good afternoon ladies and gentlemen. Welcome to Jindal Steel’s third quarter FY26 earnings briefing. I appreciate it is a Saturday afternoon. So sincere. Thank you for finding the time to join us. From a macro perspective let me start by touching upon the supply demand imbalance in the Chinese steel industry which clearly has an impact on global markets including India. The downtrend in Chinese steel demand continues to outpace the decline in domestic steel production resulting in record exports of 119 million tonnes in calendar year 25.
This level of low price exports has prompted several countries to impose tariff and non tariff barriers to curb the impact of Chinese steel imports on the local markets. Focusing on India’s performance during the quarter Crude steel production rose 2% quarter on quarter to 42.5 million tonnes in Q3 FY26 while demand increased only by 0.5% quarter on quarter to 40.7 million tonnes. Trade dynamics improved materially. Exports increased 30% to 2.5 million tonnes and in post reduced by 36% to 1.6 million tonnes sequentially. Consequently, India turned a net steel exporter again in Q3 FY26 for the first time after six quarters with net exports of 0.8 million tonnes on trade measures.
Following the DGTR’s recommendation, the ministry of Finance has notified a definitive safeguard duty on select steel imports for a period of three years on ad valorem basis with step down rates of 12% in year one, 11.5% in year two and 11% in year three ending on 20 April 2028. During the quarter, domestic steel prices in India corrected on the back of weak demand. HRC prices remained under pressure due to weak Chinese steel prices while TMT prices reflected subdued construction activities. However, prices have recovered since mid December 2025 after prolonged correction and we further expect support in Q4 with improving overall demand dynamics.
Coming to Jindal Steel the Business Update on projects we operationalized SBPP module 1 of 525 megawatts during the third quarter FY26. We are happy to report that we have also synchronized SBTP module 2 of 525 megawatts again with the grid in January 2026. With this we have achieved yet another major milestone of turning around 1,050 megawatt power plant that we have acquired under the IBC. We are also pleased to report that we have commissioned CCL1 with a capacity of 0.2 million tons per annum in January 2026. This broadens our product portfolio and supports further margin enhancement going forward.
We have opened the Utkal B1 mine and overburden removal is currently underway. The 3 million tonnes per annum basic oxygen furnace 3 at Unwood remains on track for commissioning by Q4FY26 and upon commissioning we will reach 15.6 million tons of steel making capacity. All other projects are progressing as planned and remain on track for commissioning within the scheduled timelines. Coming to the financial results, total production in Q3FY26 increased 25% quarter on quarter to 2.51 million tonnes. This was supported by two factors. Firstly, the ramp up of the BF2 and BOF2 facilities at Angul. Secondly, a newly commissioned Bhagwati Subhadrika Blast Furnace 2 achieved capacity utilization of 48% in Q3FY26 with an exit run rate of 58% utilization.
Sales volume rose 22% quarter on quarter to 2.28 million tonnes driven by higher production. Consolidated third quarter FY26 gross revenue increased 12% quarter on quarter to INR 15,172 crores driven by higher sales volume but partly offset by weaker steel prices. Consolidated adjusted EBITDA for The quarter was rupees 1593 crores translating to a margin of 10.5% and EBITDA per ton of rupees 6981. However this includes the one time BF2 startup cost of INR 350 crores and if we take this non recurring expense out the underlying business EBITDA for the quarter is higher by Rupees15.35 per tonne taking the EBITDA per ton to Rupees8516 for the quarter.
Consolidated pack for the quarter again post the one time startup cost was INR 189 crores. Our blended steel NSR was down by about 3000 rupees per tonne on a sequential basis as the incremental volumes was skewed toward HRC which carried the lowest realizations and margins in our product market. Within HRC our sales emphasis was on high throughput productivity driven segments and sizes rather than lower volume value added traits. The shift in product mix further compressed the asp. In addition, our byproduct revenues did not grow in line with our steel revenue as the cocurt plant was commissioned towards the mid of Q3 FY26.
Further, the lower byproduct sales and other operating income also contributed to the drop in aspect on a quarter on quarter basis due to the increased captive consumption on the cost front during the Q2 earnings call we guided for an increase of $3 to $5 per ton in coking coal for quarter three. Actual coal consumption cost during the quarter increased by $2 per ton during the quarter. BF2 ramp up was executed using higher cost bought out coal coke at a higher coke rate resulting in higher operating costs. With the commissioning of an additional coke oven battery in November 25, Coke costs are expected to normalize and the BF2 Coke rate has already begun to stabilize supported by improving steel realizations.
We expect a meaningful improvement in performance in Q4 compared to Q3. On the capex front we invested 2,076 crores during the quarter with this accumulative capex under the current expansion program up to 31st December 2025 is rupees 32,925 crores as against our total announced capex of 47,043 crores. We are investing in our long term growth, creating assets that will support India’s infrastructure buildout. Our investments are not limited to adding new capacity but also include strengthening our existing portfolio of assets. This will ensure best in class capacity utilization, improved asset reliability and higher profitability in times to come.
This financial year marks an inflection point in our transformational journey to build world class assets. Coming to our debt profile, Consolidated net Debt as on 31st December 2025 was Rupees 15,443 crores up Rupees 1287 crore sequentially. Accordingly, net debt to EBITDA was at 1.72 times at the end of Q3FY26. This is primarily a reflection of lower EBITDA and our CAPEX commitments on the commissioning of several facilities. We are excited about the ramping up of production and the incremental revenues and cash flows are expected to lower our net debt to EBITDA to sub 1.5x levels. At General Steel, AI and digitalization are core to our operations, driving productivity, efficiency and resilience at scale.
We are executing a multi year enterprise wide AI transformation focused on throughput improvement, cost efficiency, faster decision making and margin expansion, moving beyond pilots to scale deployments. Now AI led enterprise intelligence is embedded across sales dispatch, logistics and CXO decision support delivering real time visibility and actionable insights. Sustainability is at the core of what we do each day at Jindal Steel. With that in mind, I’m pleased to share that in our first year of ESG assessment and disclosure, Jindal Steel has been included in the S and P Global Sustainability Yearbook 2026 out of nearly 8,500 companies assessed.
We are among a select group recognized for this prestigious inclusion, an endorsement of our disciplined ESG execution which remains central to our strategy. We have also been awarded an India Sweden Industry Transition Partnership Feasibility project to evaluate a CO2 neutral steel production facility, reinforcing expertise in decarbonization and and commitment to sustainable growth. These sustainability acknowledgments and digitalization efforts are the culmination of all the dedicated work being done by the General Steel team across India and this is something that we are very proud of and keen to build on going forward. For Q4 FY26 we expect coal consumption costs to rise by 18 to $20 per ton sequentially. I know costs increased further in Jan. Domestic steel prices are currently higher by about 3,000 to 3,500 rupees per tonne as compared to December 25 and we expect prices to remain supported in Q4FY26 on the back of strong demand and strong tailwinds.
With that I will open the floor for Q and A. Thank you.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press start and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two participants are requested to use handsets while asking a question. A request to all participants to please restrict their question to two per participants. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Vikas Singh from ICICI Securities. Please go ahead.
Vikas Singh
Good afternoon, sir. And thank you for the opportunity. Sir, my first question is directed towards things. Sorry. My first question is towards the realization impact which was talking about only 3,000 rupees. But we just calculate on the average site the drop is much higher. Almost 6,005 and a half 6,000 rupees. So how much is because of the product deterioration and what else we are missing in here?
Gautam Malhotra
So as I mentioned in my. Yeah, can you hear me?
Vikas Singh
Yeah, please go ahead.
Gautam Malhotra
As I mentioned in my opening statement, we did ramp up our capacities with lower margin products. And it was mainly skewed towards hrc. And as we are actually ramping up when we were on a lower output on a hot strip mill, we were actually producing lower productivity, thinner grades and with very high value add. And the margins were higher at that time. As we are ramping up, actually thickness levels are increasing. Our productivity is increasing. So the realization per tonne over there is lower. Although we producing much more Also roughly about 3000 rupees is an account of NSR.
On this account the byproduct sales were lower. We will actually increase the capital consumption of most of our byproducts. As the steel production is increasing and the balance is coming from there. As our capacities ramp up, actually we do expect that all our byproducts will be consumed completely internally. Thank you.
Vikas Singh
So effectively on an average our realization vendor would increase lower than what the market is. Because of the byproduct credit would not be available. Is that assumption is correct?
Gautam Malhotra
Yes. But our cost will also come down. And overall if you see as our capacities ramp up, EBITDA is actually accretive in that nature. We’ll actually keep on adding to ebitda.
Vikas Singh
So my second question pertains to our cost savings exercises like slurry pipeline coal mines coming versus the product mix deterioration. Would those Cost savings as per your internal estimates are good enough to cover for the product deterioration or we would see for next 1 1/2 year are overall product will continue to deteriorate from current point of view.
Gautam Malhotra
I think using the word deterioration would not be correct over here. That’s a strong word. You understand quarter three was a tough quarter and for the entire industry and if you look at the overall realizations, HRC was the most affected out of all the products. So overall as we move up and realizations have also started increasing, NSRs have also increased. So there’s no deterioration in the product mix. Rather our portfolio as we’ve maintained over a period of time is getting more balanced towards 50% flats and 50% longs. I think that’s a great diversification and provides a lot of strength to the company in times to go forward.
Vikas Singh
So just to answer my question, would that the cost saving would be able to cover for this change in product mix?
Gautam Malhotra
Yes, definitely. Yeah, yeah.
Vikas Singh
So deterioration basically we were a little bit baffled because some of the peer group having higher weightage on the flat side had less decline in their average realization. So we are still a little bit unsure about why how our product mix has changed.
Gautam Malhotra
I’ll explain to you again two things. Our portfolio has a larger portion of longs especially TMT and that was actually hit more in terms of the realization drop from the previous quarters. Secondly as I explained whilst we were ramping when we were on a lower production on our HRC we were actually making more value add products because we had limited steel. Now as we moving towards higher output on HRC we actually producing lesser of those grades. We actually producing more of the thicker sections to get the higher productivity and thereby more ebitda. So that’s why you see the difference between the peers and us. If that explains it, notice it.
Vikas Singh
Thank you, that’s all for my.
operator
Thank you. The next question is from the line of Parthiv from Anandrati. Please go ahead.
Parthiv Jhonsa
Hi, good afternoon. Thanks for the opportunity. Just quickly continuing the previous question forward. You know one of your peer who has already declared the result. The share of exports has actually increased at a time when you know people were actually front loading especially to a lot of these geographies where there will be a lot of restrictions due to cpam especially in eu. However your share of exports has gone down to I think 5%. That’s number one. And also just quickly to check with that if you are making you know, thicker HRC and lower value added product wouldn’t it make more sense to, you know, shift it back towards higher value added product to get that benefit of a, you know, something over and above your regular blended realizations. Because this is actually impacting your ASP to a great extent.
Gautam Malhotra
So I’ll answer the first part of the question you mentioned about exports. As you look at the markets in the last quarter, the exports realization were actually lower than the domestic market even further down. And we actually managed to penetrate the Indian market with our expanded production and make space for ourselves in a market which was not expanding itself. That actually shows great strength in the Jindal Steel brand and a capability to penetrate these markets in tough times as well. What I was talking about was the ramp up phase. I do agree with you and your point is a very valid one. As we ramp up towards full capacities, first our target will be capacity utilization. And once we reach very high numbers on utilization is when we’ll start screwing the portfolio back again towards value added profiles more and more. So I hope that answers both parts of your question.
Parthiv Jhonsa
Sure. But just quickly because you said you actually expanded your market share eventually, right? Because you were able to capture, you know, higher share in the domestic market. But was it at a cost of compromising your margin?
Gautam Malhotra
No, actually compared to exports on margins in domestic were high.
Parthiv Jhonsa
No, not compared to exports purely on the domestic front. If, even if you see, if you see HRC was down about 2500, 800, your loans were down about 700 bucks.
Gautam Malhotra
We sell at competitive prices in the market. We didn’t take any large discounting to get into the market to get market share. If that’s your question. Okay, okay.
Parthiv Jhonsa
That actually answers. So my second question was on debt level. If you see one of your slides, that is slide 28, your debt in Q3 are at, you know, multi year high, as high as, you know, even higher than FY22 levels. And even if you see your leverage is quite High at 1.72, where we appreciate you giving out a guidance of 1.5x with threshold. Just wanted to get your understanding. With your capacity still ramping up, your new capacity also coming up in Q4, which will also have some kind of a startup cost associated somewhere or the other. What is your exit run rate of leverage or net debt expected in current financial year?
Gautam Malhotra
So I think firstly we should appreciate this is a very good leverage level overall. Even looking at the industry, it’s a very, very healthy leverage level. If you look at debt to equity ratios also, they also remain very healthy. Yes, we are at a point where we are coming out of a Very tough market cycle which is for the industry. And at the same time we actually are at the culmination of a project phase in these two quarters, quarter three and quarter four. Now these factors combined have pushed it up to 1.72 net debt to bidder, which you’re looking at. But overall, as I said, as we stabilize, ramp up over the next 2, 3/4, you’ll see it coming back in line to what we’ve always guided 1.5 times through the cycle and we intend and we remain committed to that.
Parthiv Jhonsa
So any number on the exit run date for debt?
Gautam Malhotra
No, I think I’ve given you the overall picture as it’s panning out.
Parthiv Jhonsa
Sure. And just again just circling back to my very first question because I think your flat too long is right now 50 50, whereas it was supposed to flat was expected to, you know, be much better off at about 60, 65% going forward. So is that, you know, is that timeline or is that Runway to take your flats to about 60, 65% or what’s your understanding on that?
Sushil Pradhan
Yeah. So good afternoon, I am Shusheep Sidhan, I am head of flat products in Jindal steel. See in Q3 our flat to long ratio was almost equal 5050 and that is because we saw a major decline in flat product rather than long product. So we maintained our product ratio shifted more towards long in the quarter. But going forward we expect a gradual shift towards flat. And as demand from flat product and demand prices for flat product is rising and demand from automotive appliances and all these segments is gradually moving up. So accordingly this mix is expected to go up in flat. I think in the Q4 we see a shift towards 55, 45 type of ratio in Q4 more towards flat flat 55 long, 45 sort of ratio.
Gautam Malhotra
Hi, this is Gautam. I just wanted to add. Please understand. And we are at a very big inflection point in our journey in general steel. There’s a large capacity coming in, there’s huge ramp ups happening and whilst we’re going through the cycle, we’ve actually maintained a very healthy balance sheet picture overall. So this is a very interesting year for us. We are at an inflection point. It is actually leading up to some very exciting times coming ahead as these capacities start, start throwing out EBITDA and cash flow.
Parthiv Jhonsa
Perfect. That’s actually quite helpful. Thank you so much.
operator
Thank you. The next question is from the line of Amit Murarka from Access Capital. Please go ahead.
Amit Murarka
Yeah. Hi, good afternoon, thanks for the opportunity. So on the power Capacity expansion. Just wanted to understand like now that you will be access I believe our capacity will you. Would you be kind of looking to ramp up those capacities and maybe sell more merchant power or. It will be purely used for steel operations.
Gautam Malhotra
At the moment as I mentioned, first unit is under stabilization and the second unit has just been commissioned and we’re going to be stabilizing it over the next two, three months. While that happens, our capacities will continue to ramp up. You know we have another 3 million tonnes coming up and associated downstream coming up. So in the near term future we’ll be actually as we ramp up all sides of the capacity and the whole facility we’ll be consuming a large portion of it internally at the moment.
Amit Murarka
Okay, okay. And just a question on your mix. So while as you mentioned that initially in the initial phase possibly the milk mix could be a bit weak but by when do you think like in terms of maybe quarters or year kind of be able to get into a more value added mixed portfolio on the expanded capacity also.
Gautam Malhotra
See I want to actually come away from these words of duration and weak when I do say that we shifted a higher productivity order book. Our value added profile still remains at 66% and that’s very high. What we are comparing that to is 71% in Q2. So that’s where we’re coming from. But it’s a very high value added percentage in our product portfolio. So I don’t think it’s weak from any perspective. It’s just that we’re in a ramp up phase. We’re making a market entry into a product and we are capitalizing on all opportunities that come out.
Amit Murarka
Yeah, no, by weak I mean, I mean I think you mentioned that you had almost like a thousand rupee additional hit to realization because of the shift in the mix. So I was referring more to that. So when can you get the thousand back in that?
Gautam Malhotra
So as we speak the markets have already rebounded and I did mention, I think in the opening statement it says that, you know, today we are working at about 3,500 rupees higher than where we were towards the end of the last quarter. As we move ahead you will see our value added profile start inching back towards 70%. So I’m not reading too much into this thousand rupee differential and that differential is more as a comparison from Q2 to Q3 in our books versus what is happening in the peers books. I’m more interested in how we, you know, coming out of the situation as we move forward. The more interesting bit will be ramping up our capacities, increasing the utilization, getting the EBITDA in and the higher cash flows.
Amit Murarka
Sure, got it. Thanks a lot. Just. And this is the last question. So you say that in this quarter you consumed your byproducts internally, which was also an additional Hector realization. So what were those byproducts? If you could explain that, a bit like, is it pellets? What would be those byproducts?
Gautam Malhotra
You’ve got it. It’s pretty much that. But please also understand that the you you’re seeing at the ASP level there, but at a bitter level, the hits are not anything material or not significant.
Amit Murarka
Okay, got it. Thanks a lot.
operator
Thank you. The next question is from the line of Sumangal Nivetia from securities. Please go ahead.
Sumangal Nevatia
Yeah, good afternoon and thank you for a chance. I have two set of questions. First, on the expansion plans. Now we shared that our next blast furnace BoF, sorry, is on track for fourth quarter. So I want to understand what is. When is the associated metallic capacity coming and what is a plan to use this bof in FY27 given the lack of metallics and in general, just the strategy of commissioning this ahead of metallic capacity.
Gautam Malhotra
So in terms of, you know, going forward. So we’re talking about the current CAPEX cycle. You’re right. BoF will be commissioned in this quarter. Anything going forward, we’ll be guiding in the next quarter on how we’re planning out on that. At the moment we’re very, very focused on commissioning all the current projects and realizing revenue, EBITDA and cash flow from them.
Sumangal Nevatia
Yeah. So just want to understand what is the plan to use this blast furnace BOF in FY27 in absence of metallic capacity.
Gautam Malhotra
We’ll be able to use about 60 to 66% of this capacity in FY27 as well.
Sumangal Nevatia
Okay, so the associated DRI or BF, I think it’s DRI. So when is that being planned to commission?
Gautam Malhotra
I think we’ve spoken in one of the earlier calls that we are targeting FY27N for that and we’re sticking to that.
Sumangal Nevatia
Okay. So even without that, we are looking at 60% utilization for this BoF. Yeah.
Gautam Malhotra
Yes, FY27.
Sumangal Nevatia
Okay. And so with respect to slurry pipeline, just want to understand what are the reasons for the delay? I mean, we still see only 94% complete. And what sort of contribution will this have in FY27 in terms of actual slurry transfer and cost savings?
Gautam Malhotra
So see, one thing we have to understand, slurry pipeline is Never an easy project and it has a lot of regulatory and other hurdles that you have to go over and basically ground level hurdles as well. We have maintained our guidance for the end of this financial year for the slurry pipeline and we are on track for that. As far as the savings etc. I think we are very fairly comfortable to say that we’ll be able to go towards 750 to 850 rupees a ton on that.
Sumangal Nevatia
Okay. Okay. So my next question is on the sales volume guidance. We just two months left for the year so where are we with respect to our 8 and a half to 9 million tons guidance for sales volume this year? Can you give some more further color on this?
Gautam Malhotra
We actually on track to hit the guidance that we’ve already given you.
Sumangal Nevatia
Okay, and just one last question on the margins. So I mean given that we’ve seen in three quarters a deterioration of almost 16,000 to 7,000. Just want to understand, I mean this ramp up and startup cost, has this been going as per plan? Was this anticipated or. There has been some negative surprises because it’s quite difficult to appreciate 350 crores of startup cost. We’ve not seen that in other companies and looks like, I mean just, just want to get some more grip and understanding on this.
Gautam Malhotra
So I’ll say two things. I always, I don’t like going on what peers are doing. Everybody is good in their areas. But there are two points over here. We’re being fairly open and transparent about how we’re going about our business and we’ve maintained that over a period of time and we intend to continue doing that. Coming to the second part of your question. Yes, a large part of it. When you’re ramping up a facility, especially a blast furnace, it’s not immediate that you get down to your capacity utilization numbers or your coprit. It takes a little bit of time and that was anticipated.
Nevertheless, I don’t think we’re in a position to say that we didn’t receive any surprises. Yes, there were surprises along the way but I think I must say kudos to our team which has been able to counter those surprises and ensure that as we sit today we are at a very high capacity utilization number with industry standard cocreates and operational parameters. So I think they’ve done a brilliant job of coming on track on a furnace of this size in two to two and a half months.
Sumangal Nevatia
Okay, and if I may just ask one question just to understand what is the base level of profitability for us to kind of have a better forecasting capability. What is the contribution of these byproduct sales say from FYI in FY25 or say 1h FY26 so that we just, I mean get to some base level of profitability from where we can kind of forecast future earnings.
Gautam Malhotra
I think there are a lot of things in your question. It’s got a lot of years spanning it and some forecasting as well. So in the interest of time I think I am asking Vishal to take it offline. If you can connect with him and he can help you with that.
Sumangal Nevatia
Sure, sure, I’ll connect with Vishal. Thank you. And all the best. Yeah, thanks a lot.
operator
Thank you. The next question is from the line of Jashindip Singh Chatta from Nomura. Please go ahead.
Jashandeep Singh Chadha
Hello, I hope I am audible and thank you for the opportunity and most of my interesting questions have been taken by my peer. So I’ll, I’ll start with sir, how much? So I see that you have a commission call. You know mine as well. There is one iron ore mine also has been commissioned with that and the global, you know, coal prices going up. What sort of impact do you think will you know, hit the company in fourth quarter? If we can start with this?
Gautam Malhotra
Sorry, can you. I didn’t understand. Can you please repeat the question?
Jashandeep Singh Chadha
Yes sir. So I just want you to understand the you know, input cost escalation that we might see in fourth quarter for gspl.
Gautam Malhotra
I don’t think we’re expecting any input cost escalation in the fourth quarter. There’s only one thing which I think I’ve given in the opening statement is on the coking coal prices. But if you see the market has more than commensurate increase. So I think there’s no material input cost escalation that we’re going to see. Apart from that.
Jashandeep Singh Chadha
Okay, so. So largely what I can understand is you are expecting a flattish input cost is my understanding. Right.
Gautam Malhotra
Apart from coping pool. Yeah, Nothing, nothing there.
Jashandeep Singh Chadha
Okay, nice. You know, second question is largely, you know, from FY27 I understand you have given guidance for FY26 and you are on track on maintaining that guidance. I also understand companies at inflection point and ramping up capacity is not that easy. From that perspective, how do you see FY27 pointing, panning out in terms of production and volume. If you can give some sense on that, that would be great.
Gautam Malhotra
I think I’ll pick on one thing you said at the beginning of your question. We are at an inflection point. Yes, I did say that. And please understand we are maintaining a guideline, a guidance given in a year where we are commissioning capacities, ramping them up and sustaining our guidances. And so I think I must even on this platform congratulate our team for having been able to do that. At least be on track for that be to the end of the year in terms of FY27 I think will be coming out very soon. We are in the process of finalizing our business plans for the year and as soon as we do that, I think at the end of the next quarter we’ll be coming back to you and giving you guidance for that.
Jashandeep Singh Chadha
Understood. Just one last question. Compared to when you initially announced this first phase of expansion in sometime in FY22, early FY23 and now since you are at the end of most of the phase one expansion, how much of the capex that you earlier and now you know which you have realized how much has been the capex cost increased because of, you know, the various surprises that you face, various challenges and delays. So what, what sort of, you know, capex increase would have been there?
Gautam Malhotra
I think there have been no material project cost overruns. I think there’s a lot of over the years there’s been a lot of projects that have been added into the scope rather than any major cost overruns. I think if you go back in time, two, three quarters back, we did talk a lot about it and I think it should be available. Otherwise you can connect offline with Vishal if you need further help.
Jashandeep Singh Chadha
Sure sir, definitely. I’ll connect with Vishal and thank you so much. I’ll join back with you for my further questions.
operator
Thank you. The next question is from the line of Rahul Gupta from Morgan Stanley. Please go ahead.
Rahul Gupta
Yeah. Hi. Thank you for taking my questions. I have two questions. One, sorry for getting back on the steel prizes question. You said that the steel price are up by around 3,000 to 3,500 versus quarter end and given trajectory for realization has been worse than how steel prices fared in third quarter. Is it fair to say that if steel prices remain where they are you would see a much better Trend in realization versus this 3000 to 3500.
Gautam Malhotra
Hi, can you kindly repeat your question please?
Rahul Gupta
So what I’m asking is that steel prices as you said has increased by 3,000 to 3,500 versus quarter end. That was part. But in the third quarter your relation trends were weaker than how steel prices fared. So is it fair to say now that your blast Furnace would ramp up and HSM capability will ramp up. Your relation trends will be much better than the steel prices trend of 3000 to 2500.
Gautam Malhotra
Yes, you’re right. And they’ll be in line with the industry. And I think if you’re referring to that incremental thing which you’ve been definitely that won’t be there. We’ve realized more than that and will be in line with industry trends as we move forward.
Rahul Gupta
Got it. My second question is more medium term and strategic. Now that you have you are ramping up a flat capacity over the past couple of years you have strategically moved away from export market and focused on the domestic market. Now that EU prices are supposed to move up on back of cba is it fair to say that you would be actively looking at the European market from here over the next two, three years?
Gautam Malhotra
No. So you know we. As you have seen in the past we are predominantly producing material for the domestic industry with a very strategic focus in the external market. And you are right. Our major market has been European market for plates. Now with HSM coming in also the prime focus will be on European market. But that will be around 5 to 10% range only.
Rahul Gupta
Got it. Thank you so much. Wish you all the best.
Gautam Malhotra
Thank you.
operator
Thank you. The next question is from the line of Tushar Chowdhury from Prabhudas Leeladar Private limited. Please go ahead.
Tushar Chaudhari
Good afternoon sir. And thanks a lot for the chance. Sir, I’ve missed few numbers from your initial opening remarks. 350 crores. You said for one time blast furnace setup cost. And there was one more 189cr that was regarding.
Gautam Malhotra
The bat is 189crores for the.
Tushar Chaudhari
Okay. Okay. So anyways that is for the flat products. Now we have with all the new setup BF2F we have all the tools from OEMs like autos and consumer durable. For next few years we will. From next few quarters we will start improving our product mix.
Gautam Malhotra
Yes. We already come in supplies to auto and engineering industry. And we have necessary approval from this industry. But then since our flat product capacity is more plates and hr, you know. So it will be more into commercial commercial vehicle segment, earth moving segment and yellow good segment. More of it will go into that. And we have all the necessary approvals from all these segments. And we already started supplying to the segments.
Tushar Chaudhari
Okay. And now by next year, I mean the next quarter we will be finishing BOF 3 also when will be. We will be in a position to announce next phase of CapEx. Basically our long term plan is to take angul towards 25. So any color on that.
Gautam Malhotra
So we are very focused on increasing our utilization on these assets. Increasing our ebitda, EBITDA margins and increasing our cash flow, reducing debt to our previous guidance given for the cycle. And at the moment that’s our focus and we remain committed to that as and when we make any expansion plans in times to come we’ll definitely make sure that we keep you updated.
Tushar Chaudhari
Okay, thanks a lot and best of luck sir.
operator
Thank you. The next question is from the line of Pallav Agrawal from antique stock brokings. Please go ahead.
Pallav Agarwal
Yeah. Good afternoon sir. So I had a question on coking coal prices. So we’ve seen the spot prices going up to $250 levels. So do you think it’s more of a seasonal uptake and probably we should see a correction because if they sustain at this level then you could have a push up in cost even in the first quarter of FY27 and that would probably offset most of the increase in steel prices. I just wanted your thoughts on that.
Gautam Malhotra
So these are transient in nature and seasonal impacts that you see here. There not any midterm or long term impacts that you’re talking about. Those you know, one off sharp corrections or upticks. Apart from that I think on a lot of things we also have our long term arrangements as well and we benefit from those as well.
Pallav Agarwal
So how much you know would part of a coking coal be coming from a Mozambique and South Africa mines? Any proportion from there.
Gautam Malhotra
About 15 to 20%.
Pallav Agarwal
Sure. Also you know you mentioned that you know cost probably in fourth quarter apart from coking coal should be flat or similar. But any benefits from the capital power or Utkal mine opening up so that can come in.
Gautam Malhotra
See the mines just been opened up and we already coming to the near middle of the quarter to realize any meaningful gains in this quarter I would refrain from. But yes, in times to come we’ll definitely see benefits.
Pallav Agarwal
Sure. Okay. Yeah. Thank you so much.
operator
Thank you. The next question is from the line of Ashish Kejriwal from Nuama Wealth Management. Please go ahead.
Ashish Kejriwal
Yeah. Hi. Thank you for the opportunity sir. First of all many congratulations for successfully ramping up faster than expected. Your blast running as well as BOF capacity. That is commendable. So my question is on the cost part as well as realization. If you look at you have clearly. Mentioned about 350 crore of startup cost which could be regarded as one off. But if you can just give more detail into that or what could be that? Whether one, it’s one. You have said higher coke consumption as well as the coke ratio and what else is there? And what do you think that this number could be there in fourth quarter or have we stabilized by December? And this, that’s my first question.
Gautam Malhotra
The largest portion of that number is on account of coke because it’s bought out coke at a higher cost. It’s a little bit inferior quality to what we produce in house. And obviously when you start a furnace it’s too much technical detail and you can I think connect offline with Vishal. But it’s a standard process of, you know, starting up a furnace and stabilizing it. I do acknowledge your remark for commending our team for the faster ramp up than expected. Yes, I do acknowledge that. Thank you for commending the team. And to answer the last part of your question, yes we’ve stabilized and we are at normal industry standard productivity KPIs. And especially.
Ashish Kejriwal
That means that Q4, Q3 when we are talking about roughly 7,000 rupees per 10 EBITDA I think we can begin with 8 and half thousand rupees per ton EBITDA because this is largely over is that assumption right?
Vishal Chandak
So Ashish Vishalier, we do not, we actually refrain from giving guidances on EBITDA on a sequential basis. But I understand where you are coming from. If you look at as sir mentioned, you know about 350, 50 crores is the one off which will obviously not recur and steel prices have moved up and so has also the cost. By and large our understanding is that Q4 should be a much stronger quarter in both in terms of volumes as well as in terms of profitability.
Ashish Kejriwal
Vishal, we are not asking about Q4 guidance. I’m just asking the base case that. You know when we are saying it’s. One off that means we can say, you know, eight and a half thousand rupees could be the price, could be the math is correct.
Gautam Malhotra
I think Vishal gave you a good answer but your math is correct. That’s okay.
Ashish Kejriwal
Second thing is when we are talking. About realization improvement, three, three and half thousand rupees higher are we taking into consideration the improved product mix also when I’m saying improved product mix that you know, maybe in third quarter because of the initial stage we have given some of you know, base grade hrc. But now with this improvement ideally our overall realization for fourth quarter should be higher than that of the industry because third quarter was much lower than the industry standard.
Gautam Malhotra
The numbers that I Mentioned for the increased realizations are as is scenario right now. I think we only at the beginning of the quarter. I did mention in one of my earlier answers that you will see us at industry levels in this quarter and as we keep ramping up and improving our capabilities you see us beating those numbers again as in the past.
Ashish Kejriwal
And lastly, is it possible to share non steel sales revenue in this quarter versus last quarter? Because I understand as you rightly pointed out that lower byproduct sales does not affect our ebitda. But at least on the top line, if you get a sense how much was the non steel sales revenue in this quarter versus last quarter, that will be very helpful. Thank you.
Gautam Malhotra
I think Vishal can help you offline with that. If that helps you can connect with him.
Ashish Kejriwal
Sure, we’ll do that. Thank you so much and all the best.
Gautam Malhotra
Thanks a lot.
operator
Thank you. The next question is from the line of Siddharth Gardiker from Exidious tc. Go ahead.
Siddharth Gadekar
Hi sir. So just first again on the one off cost. So when we. Just a suggestion here that when we give a justic EBITDA in the presentation can we include the numbers? Because every quarter we have a different adjusted EBITDA and on the call also we have a different one off expenses every quarter in the ebitda. So it becomes very confusing to understand what is the actual EBITDA per ton. So secondly, in terms of our downstream, what all capacities are left to commission over the next two years?
Vishal Chandak
Siddharth, this is Vishal here coming to the second question. Over the next two years the downstream capacities are largely commissioned except for CCL2 and CGL2. Okay. Thereafter we have Pellet Plant 2 and DRI2 are the key capacities. If there are any more production, any more lines that we plan, we’ll come back to you. Out of the two QNT furnaces, we’ve already commissioned one of them.
Gautam Malhotra
But I think he was asking two years. It’s not two years. All these capacities are being commissioned as we speak. We’re in the final stages of commissioning them. It’s not two years, it’s only DRI two and pellet plant two which I mentioned earlier in my. One of my questions is stated for FY27 end.
Siddharth Gadekar
Okay.
operator
Thank you. The next question is from the line of Kamlesh Bagmar from Lotus Asset Management. Please go ahead.
Kamlesh Bagmar
Yeah, thanks for the opportunity. So just wanted to get a sense on the product mix going forward because over the last like say prior to this commissioning we had the benefit of having a real meal Then your mlsm, those all benefits were there rubm. So going forward don’t we think that our earning would grow primarily because of the volumes and with the lower margins? So what’s your sense on that? Because it’s like during the call the questions have been asked that our margins which was 15,000 Q1 in Q1 has fallen down to 8,000 or rupees adjusted basis 8,500 rupees.
So but going forward like say now we would be having the benefit of the volumes but our margins would be lesser as compared to the historical levels. Because if you see in your like say HRC many of the capacities are coming up be it Tata Steel or like say EMNs coming with a big capacity. So do you think that now going forward the play would be on the higher absolute EBITDA rather than much richer margins as compared to the historical levels?
Gautam Malhotra
First part of your question, we don’t, we actually don’t moved away from rail or MLS or you know, structure.
Kamlesh Bagmar
I’m not saying that you have moved away, I am saying that the share of those products or the volumes have now come down significantly because of these hot like say flat based capacities coming in. Because even if I see quarter on quarter your product mix has like say 49 flat has gone up to 50 and the HRC meal was commissioned a year ago. So now we saying that we have sold lesser gate hr. So it really doesn’t digest with the margins or the realization fall which we are talking in this quarter.
Gautam Malhotra
Okay, so I’ll complete my answer. So it’s not that we’ve gone away from those, they remain a core part of our portfolio and as we speak we actually keep working on ways to increase those facilities output as well. Apart from that, the second part of your question is. Yes. Will these other products increase in our portfolio and our product mix? Yes they will. But along with that I think Vishal did mention that we’ve also added heat treatment furnaces so those will add capability to our flats portfolio for higher realizations, higher value add. Apart from that, as I did mention in one of my earlier questions on the opening statement that we’ve just penetrated the market on a higher volume in this quarter. As we move ahead, our value add percentages and value add products will keep growing and the realizations will be back on track. So I don’t see anything in the mid to long term future that is of any concern at the moment.
operator
Thank you. The next question is from the line of Rashi from Citi. Please go ahead.
Raashi Chopra
Thank you. First question on your costs. So you indicated that there were startup costs and cooking coal costs were also higher. So optically it does appear on a sequential basis that the costs are lower. So one of course is the volume benefit and I would imagine lesser value addition. Is there anything else to read into?
Gautam Malhotra
I think you broadly covered it. You’ve got it pretty much on the wall.
Raashi Chopra
So going forward we basically expect a reversal of the startup cost and then we expect higher coking gold prices. Simplistically.
Gautam Malhotra
Yes, but please also understand that coking cash Coke output is increasing because we’ve commissioned the batteries and as it did mention that our Coke is better quality than what we end up buying from the market. So we’ll get some offset gains from that side and obviously high utilizations will also give us some gains in our cost portfolio. So those gains will also be there.
Raashi Chopra
Got it. Secondly, when you indicated that spot realizations are about three to three and a half thousand rupees higher than the December quarter, this is your, you’re talking about what you are kind of billing at this point in time. Right. On a blended basis given product makes everything put together.
Gautam Malhotra
Yes. This is the difference in the realization between where the Last part of Q3 was and where we are today.
Raashi Chopra
Got it. And for the full year the capex that you had, target that you had given are still holding on to that. Like no change capex targets for 26, 27, 28.
Gautam Malhotra
No, nothing. No change.
Raashi Chopra
And one last question for me. How do the inventory move sequentially?
Gautam Malhotra
How does what? Sorry?
Raashi Chopra
How did the inventory move sequentially? Inventory.
Gautam Malhotra
Steel inventory marginally improve or increased during the quarter but as we speak it’s being unwound as well. There’s no nothing material in that.
Raashi Chopra
Thank you.
Gautam Malhotra
Thank you.
operator
Thank you. The next question is from the line of Ritesh Shah from Investec. Please go ahead.
Ritesh Shah
A couple of questions. First is clarification. When we give guidance of sales volumes, should we presume that it is excluding any metallics purchase, be it for this fiscal or next fiscal?
Gautam Malhotra
No. Yes, there’s no metallics purchased.
Ritesh Shah
Okay. And would it be possible for you to provide a timeline for the sms, the next sms?
Gautam Malhotra
We’ve given a guidance already that it’s going to be this quarter and we are well on track for that.
Ritesh Shah
Okay. Second is, can you indicate cooking coal on a consumption cost basis? How much would be the increase from Q3 to Q4? I’m sorry if I, if I missed that.
Gautam Malhotra
About 18 to $20 per ton.
Ritesh Shah
That’s helpful. Just a few more questions, sir. How do we Plan on the evacuation specifically. Also if you could highlight how. How critical is the paradip port over here given Angula’s in east? I’m not very sure. And you did indicate that we have the approvals to supply for hrc. Given the scope of our capacity is very large, how do we plan to sell and evacuate? Some color over here would be quite useful.
Gautam Malhotra
Are you talking about evacuation from our plants from Angul? I think whatever we’re producing, we’re being able to evacuate. We have the infrastructure and the capability for that.
Ritesh Shah
So this includes any incremental rail lines or. It’s. It’s already. There’s. There’s no problem at all on evacuation. Okay, and how critical is the paradip port? Because in earlier calls we have emphasized about it. How does that fit in an overall scale. Scale of things?
Gautam Malhotra
See, I think if you’re coming from this expansion phase that we’re talking about and you were talking about it, Paradeep port does not impact anything for Angol. Capacity expansion, ramp up, etc. Paradeep Port is a very strategic thing and it’s a longer term play and it’s a benefit that we’ll be able to derive for our import and export in times to come. But if you coming back to the specific Angul ramp up, there’s no effect of Paradeep and nor did we envisage anything like that.
Ritesh Shah
Perfect. Just to follow up clarification questions, sir, how should we look at General Panther expansion? I think this is the one with the cement entity. I’m not sure whether it’s linked with the listed Jindal Steel entity. That’s. That’s one clarification. And second, I presume there would be some transfer of slag from the listed entity to this very entity. If you could highlight some color on how the transfer pricing mechanism is.
Sunil Agrawal
So this is Sunil Agrawal from. So basically General Panthers has nothing linked with the General Steel. It is a separate company and we are independent of Jindal.
Ritesh Shah
Okay. And on Slack.
Sunil Agrawal
We will be giving at the transfer pricing as per standard norms if we’ll supply to them on long term basis.
Ritesh Shah
Okay, and just last one, sir, would you just clarify that the Tyson bid with General International has basically the listed entity is completely ring fenced from it.
Sunil Agrawal
Yes, you are right.
Prateek Singh
Thank you so much for the answers.
Sunil Agrawal
Thank you.
operator
Thank you. The next question is from the line of Rajesh Mazumdar from 361 Capital. Please go ahead.
Rajesh Majumdar
Yeah, good afternoon sir. And thanks for the opportunity. So I had only one question, actually two but related. Out of our total capacity of 15 million tons, what is the proportion that will go to the auto industry? That was the first question.
Sushil Pradhan
It will be around 3%.
Gautam Malhotra
Oh, only 3%. Okay.
Sushil Pradhan
Yeah. Because then. So we don’t have CRCA or products which are related, which mostly going to auto. So it will be somewhere around 3%.
Rajesh Majumdar
So the second question is actually less relevant, but I’ll still ask it in the sense that we’ve seen a lot of headwinds for the auto manufacturers. And Maruti also in the call actually. Registered the increase in the steel prices. There is a chance of a rollback there. So do you think that the auto HRC prices will come off a little bit from the negotiated level? Yeah, that’s it.
Sushil Pradhan
No, we. I won’t be able to comment on that. Yeah.
Rajesh Majumdar
Thank you.
operator
Thank you. Ladies and gentlemen. Due to time constraint, that was the last question for today. I now hand over the conference to management for closing comments. Over to you, Sir.
Gautam Malhotra
Thank you. Q3 FY26 was a challenging quarter. Despite the sharp decline in steel prices and muted demand. We delivered record production and sales volumes. We also commissioned several key projects, most notably synchronizing the 1050 megawatt SDTP with the grid. The ramp up of our newly commissioned BF2 and BOF2 facilities is in full swing and is progressively strengthening our operating profile. We expect the fourth quarter, FY26 to be a stronger quarter supported by a higher opening volume, improved pricing and better underlying steel demand. Industry 4.0 and AI remain central to our transformation agenda, enhancing reliability, productivity and real time operational control across the value chain.
Our key projects are progressing as planned and remain on track for commissioning as per schedule. Going forward, we will continue to prioritize safe and stable operations, disciplined value creation and sustainability to deliver value creative growth. I once again thank you for your time on this Saturday afternoon. Have a good day and have a good weekend. Thank you.
operator
Thank you on behalf of Jindal Steel Ltd. That concludes this conference. Thank you for joining us and you may not disconnect your lines. Thank you. Thank you.