JSW Steel Ltd (NSE: JSWSTEEL) Q2 2025 Earnings Call dated Oct. 25, 2024
Corporate Participants:
Ashwin Bajaj — Group Head Investor Relations
Jayant Acharya — Joint Managing Director & Chief Executive Officer
Swayam Saurabh — Chief Financial Officer
Analysts:
Amit Dixit — Analyst
Alok Deora — Analyst
Sumangal Nevatia — Analyst
Ritesh Shah — Analyst
Ashish Kejriwal — Analyst
Kirtan Mehta — Analyst
Amit Murarka — Analyst
Raashi Chopra — Analyst
Ashish Jain — Analyst
Presentation:
Operator
Ladies and gentlemen, good day and welcome to JSW Steel Q2 FY ’25 Results Conference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Ashwin Bajaj, Group Head of Investor Relations. Thank you, and over to you sir.
Ashwin Bajaj — Group Head Investor Relations
Thank you, operator. Good evening, ladies and gentlemen, this is Ashwin Bajaj, and it’s a pleasure to welcome you to JSW Steel’s earnings call for Q2 for the financial year 2025. We have with us today the management team represented by Mr. Jayant Acharya, Joint MD and CEO; Mr. G. S. Rathore, Chief Operating Officer; and Mr. Swayam Saurabh, the Chief Financial Officer.
We will start with opening remarks by Mr. Acharya and then open the floor to questions. So with that, over to you, Mr. Acharya.
Jayant Acharya — Joint Managing Director & Chief Executive Officer
So good evening, everyone. Thank you for being here. The global economy continues to perform well. The IMF has maintained its forecast of a stable growth in the year 2024 and ’25 both. Inflation is cooling off, IMF has also upgraded the US growth forecast however, Europe, China, Japan continue to be a bit weaker. The interest rate cutting cycle has begun and that is likely to be a positive for the economy at large. China’s announcement of a stimulus has been a positive development and we see that reflecting in commodities and metals. Geopolitical risks, especially from the potential escalations which we have seen in the recent past remain a key concern.
In India, good monsoon is expected to benefit the rural economy. As we go into H2, we see the government capex, which was slow in the first half due to the elections and weather disruptions will improve. A healthy fiscal balance, stronger tax — tax collection should be supportive of continued capex spending. The RBI has maintained its GDP growth projection of 7.2% and has shifted its stance to neutral, which opens up space for policy easing going forward once the inflation expectations are under control.
Global steel production declined by 1.9% year-on-year to 1394 million tonnes, during January to September. This includes about 3.6% drop in China, while the rest of the world saw a modest growth of 0.3%. In quarter two FY ’25, India’s crude steel production grew by 2.7% Y-o-Y to 36.23 million tonnes, with a consumption growth of 11.6% Y-o-Y to 37.09 million tonnes. We expect this strong demand momentum to persist with steel demand likely growing by around 10% to 11% in FY ’25. India steel imports in quarter two jumped by about 43% Y-o-Y to 3.18 million tonnes, while exports fell by close to 30% to 1.27 million tonnes, making India a net importer of about 1.9 million tonnes for the quarter.
Meanwhile, China’s aggressive steel exports growth resulted into 84 million tonnes getting exported in Jan. to September, which was a growth of 21% has put pressure on the global steel prices at large. In response, several countries have imposed restrictions on Chinese imports. The Indian Steel Association is actively engaging with the government to ensure a level playing field for the domestic industry. Notably, the DGTR has initiated anti-dumping investigations against Vietnam and China for certain products during the quarter.
At JSW Steel, mainstreaming sustainability across our business and generating sustainable value has been a priority. Energy transition is one of the focus areas for us to achieve carbon neutrality by 2050. So far, the Board has approved procurement of renewable power totaling 1637 megawatt across our locations. Of this 375 megawatt has been commissioned and balance are in various stages of being commissioned. The Board has approved further renewable capacity of 870 megawatt, taking our total renewable capacity under procurement to 2,507 megawatts. With this, we will be able to achieve close to 25% of our power requirement, including JVML through renewable.
JSW Steel has consistently delivered industry leading value accretive growth, over the past two decades. We have already outlined our roadmap to reach 50 million tonnes in India through brownfield expansion by FY ’31. Expansions are underway to achieve 42 million tonnes capacity in India by September ’27. The 1 million tonnes expansion in BPSL has been commissioned, taking the capacity to 4.5 million tonnes. Incremental volumes are expected to flow in from quarter three ’25. At JVML Vijayanagar, we have commissioned the HSM in March ’24 and followed it up with the blast furnace and some associated facilities in end September. The steel melting shop is under commissioning and ramp-up is expected by quarter four ’25. Alongside expanding our steel making capacity, we are also strengthening our downstream capabilities with a strategic goal of driving over 50% of our sales from value added and special products. As a part of this vision, we recently acquired 100% equity in thyssenkrupp Electrical Steel India Limited through a joint venture with our partner JFE Steel. This acquisition grants the joint venture immediate access to the market as the production at our joint venture [Indecipherable] facility in Vijayanagar is expected to begin in 2027. Additionally, JSW Steel will also get access to technology for electrical steel making — from thyssenkrupp Steel, further strengthening our technical edge and market position.
Coming to our strategy of enhancing our raw material security. In Karnataka, we have increased our iron ore mining from 7 million tonnes to 11 million tonnes capacity for our existing captive mines and we expect to mine about 10 million tonnes from these in FY ’25. Of the three new mines in Karnataka, two are likely to be commissioned in quarter four of FY ’25. The third mine is expected to be commissioned latest by first quarter of FY ’26. These announcements will take our Karnataka captive mining capacity to 15.5 million tonnes.
In Goa, the public hearing for one of our mines has been completed and we are working towards commencing mining operations in the next three to six months, which has a capacity of 0.5 million tonnes. Meanwhile, BPSL’s Netrabandha [Phonetic] mine in Odisha is also expected to begin production in the next three to six months with an estimated capacity of 2 million tonnes per annum.
On the coking coal front, we have completed the acquisition of 20% effective interest in Illawarra coking coal mines in Australia, with offtake to start early FY ’26. Additionally, we secured long-term coking coal linkages from Coal India during recent auctions. These linkages available for 15 years will provide around 2 million tonnes of raw coking coal, further strengthening our overall raw material base on this critical resource.
During quarter two of FY ’25, we reported consolidated crude steel production of 6.77 million tonnes, which was up by 7% Y-o-Y as well as quarter-on-quarter, steel sales at 6.13 million tonnes, which was down 3% and flat Q-o-Q. Our capacity utilization was higher at 91% versus 87% in quarter one of FY ’25. While a sharp decline in exports due to weak global markets impacted sales volume.
Crude steel production at our Indian operations for the quarter at 6.63 million was the ever highest, growing by 7% Y-o-Y and 8% Q-o-Q. Steel sales for the quarter at 5.96 million tonnes were lower by 4% Y-o-Y and higher 1% quarter-on-quarter. While exports were significantly lower and that was the main reason for a lower sales volume, the domestic sales were the highest-ever, growing 5% quarter-on-quarter and 1% Y-o-Y on a good domestic steel growth in the first half of this year.
We had the highest ever quarterly sales to the institutional segment, up by 12% Y-o-Y. Our sales to the solar segment grew by 54%. We reported highest-ever sales in LRPC and wire rod. Our sales to the appliance segment grew 43%, while our tinplate sales to the packaging sectors were also up at 38% Y-o-Y. Our VASP sales, volumes was at 60% during the quarter, which was primarily lower due to lower exports. On a half yearly basis, while exports fell 35% Y-o-Y, our domestic sales grew 7% Y-o-Y to 10.88 million tonnes, which was our highest ever half yearly domestic sales.
Quarter two FY ’25 financial performance has been in a challenging external environment. Our consolidated revenues from operations were at INR39,684 crores, down 8% quarter-on-quarter, while EBITDA stood at INR5,437 crores, lower marginally by 1% quarter-on-quarter with an EBITDA margin of 13.7%, which is an improvement over the last quarter. Our EBITDA on per tonne basis was at INR8916 per tonne and the profit-after-tax was INR404 crores. At our India operations, EBITDA per tonne at INR9,266 was marginally higher quarter-on-quarter and our investor presentation has a slide giving metrics on the India operations.
During the quarter, we have seen strong price headwinds, especially in September, largely driven by elevated imports into India. Our export sales and realizations were also impacted due to weaker global sentiments and elevated steel exports from China. Our India NSR fell by a little over 3,000 on a quarter-on-quarter basis during quarter two FY ’25. While the international prices fell by about $50, if I were to take China reference prices. But in spite of these headwinds, we were able to deliver a resilient performance in the quarter aided by a sharp reduction in costs. Our coking coal costs, as we had guided was lower by $27 per tonne. We also benefited from lower iron ore costs and lower inventory losses versus the last quarter.
The US operations Ohio and Texas combined had an EBITDA loss of about $11 million, primarily because of drop in prices, both in hot rolled coil and plates and a maintenance shutdown at Ohio. The Italy operations generated an EBITDA of 6.2 million, volumes improved, but the pricing environment remained weak.
As you are aware, we have applied for the surrender of the Jajang mine in Odisha in August ’24. IBM has approved the mine closure plan, and we have then submitted a further application for surrender of the mine to the state government. Pursuant to the closure plan approval, we have recognized a provision of INR342 crores, which is an exceptional item during the quarter. Our net debt increased by approximately INR4,900 crores to about INR85,000 crores, mainly due to capex, the acquisition of our Illawarra coking coal asset and some increase in working capital, including the recently commissioned capacities of JVML and BPSL.
We expect working capital release during H2, driven by inventory liquidation during peak consumption season. We spent about INR3,384 crores of capex during the quarter, INR7,850 during H1. We are revising our annual capex down from INR20,000 crores to INR16,000 crores to INR17,000 crores, primarily on account of transfer of slurry pipeline to JSW Infrastructure and the BF-3 shutdown at Vijayanagar being shifted to H1 post stabilization of the BF-5 furnace JVML.
Our revenue acceptances as on 30th September were $1.81 billion, while capital acceptances were at $71 million. JSW One platform, our one stop digital marketplace for Indian MSMEs in the manufacturing and construction ecosystem continues to scale up and has more than 67,500 registered MSME customers. The GMV during quarter two scaled to almost 2.4 times Y-o-Y to INR2,755 crores and continues to grow rapidly. JSW Steel holds 62% in JSW One platform on a fully diluted basis.
On the outlook side, I think as we highlighted earlier, we will get enhanced production from the new capacities at BPSL and Vijayanagar from H2 onwards. We are retaining our volume guidance of 28.4 million tonnes for production and 27 million tonnes of sales for FY ’25. We will take the five month shutdown of BF-3 Vijayanagar for capacity enhancement post the stabilization of the new blast furnace at JVML. We expect that to happen in FY ’26, the shutdown of BF-3. For quarter three FY ’25, we are seeing improved sentiments in domestic and global markets following the China stimulus announcement, leading to an uptick in global steel prices. Similarly, the domestic steel prices after bottoming out in September have increased in October, both in longs and flats. We expect costs to go down, driven primarily by coking coal in the range of $20 to $25 for the quarter three as we go ahead. We expect a healthy domestic demand in H2. And this, along with the positive pricing momentum should actually help our margin expansion in the second half.
To conclude, India has become a major contributor of growth in the global economy, offering a multi-decadal opportunity. This is true of the Indian steel industry as well. Out of the total demand of the rest of the world, which has been given by World Steel, of 29 million tonnes expected in this calendar year, 40% plus is coming from India. We expect strong domestic steel demand in H2, driven by the pickup in capex by the government and private capex as well. It will be aided by a better monsoon and rural recovery. RBI stands to neutral, should be positive and should stimulate interest rate cuts in the coming months, and that would be stimulating investment and consumption in the country at large. China stimulus remains a positive development. We have to monitor their exports, which remain a key concern for the global steel industry. Looking ahead, JSW Steel’s performance should be better in H2 with new volumes coming in from our new capacities. The price momentum looks better, lower coking coal costs and higher volume should aid overall EBITDA for the second half.
Thank you, and we look forward to your questions.
Questions and Answers:
Operator
Thank you very much. We will now begin the question-and-answer session. [Operator Instructions] The first question is from the line of Amit Dixit from ICIC Securities. Please go ahead.
Amit Dixit
Yeah, hi. Good evening everyone, and thanks for the opportunity. Congratulations on a good set of numbers in a very challenging quarter. I have two questions, the first one is on essentially H2 outlook. While you have outlined that things look better, but of late, we have seen an MBC taking iron ore price hike, which is not fully reflected in the steel price hike, at least in flat. So just wanted to understand how the spreads could improve in H2, regardless of coking coal advantage that you mentioned. And similarly, we have retained our volume guidance — but the outlook — but for achieving that, the rate has to be very steep. So just wanted to understand the overall confidence on that. That is the first question I have.
Jayant Acharya
So a question on basically the H2 outlook and improving — basically, margin improvement. So from the NMDC price, iron ore price side, you’re right, the prices have been increased and very quickly 2 times, which was actually, we feel not warranted in this pricing scenario. Typically now since NMDC is a steel producer as well. However, internationally, the way we look at it is that the prices inched up after the China stimulus on the iron ore side, but has now again moderated a bit. We feel the domestic iron ore prices will also moderate from the increase announced by an MDC in this month. Having said that, we have certain inventories with us. certain, I would say, certain one-offs of the last quarter, which impacted cost will not be there this quarter. That would be positive. Coking coal, $20 to $25 will pay a positive. So these will reduce our costs going into quarter three.
On the price side, yes, I think we have taken a price increase, both in flat and long. We feel that the pricing in September had gone down steeply on the back of international drops. This has improved in terms of sentiment I think the channel stocks had reduced. So restocking demand and demand from the institutional customers have improved. And if you see our commentary, I think while retail was impacted by import sentiment, exports were lower, but our institutional sales even for the first quarter as well as for the first half were actually very strong. Our institutional sales numbers for first half where, again the highest ever and grew by 15%. So our focus on this remains extremely strong. We expect now retail restocking to start. Pricing, we feel will remain positive because of a seasonally stronger quarter three and quarter four. So that would aid margin expansions as we go into H2.
Amit Dixit
And volume, sir?
Jayant Acharya
From a volume perspective, we are retaining our guidance for the overall volume 27 million tonnes of sales and 28.4 million tonnes of production. I think we’ll be, by and large now on track to achieve with the new capacity is coming on stream.
Amit Dixit
Okay. The second one is on the recent acquisition that we announced of this thyssenkrupp steel in India and that CRGO capacity. So is it possible to share some more contours around that? What is the current capacity there? How much capacity — whether there is a scope to increase the capacity in the future what is the current EBITDA margin? And what is the likely margins you can look at in the future? If you can just give some broad content, that would be great.
Jayant Acharya
I’ll be able to give you broad because the — there are still certain subject to approvals in the process. But CRGO facility in — as an asset is a very critical asset for the country at large because CRGO is a very critical material for transformers and generators. We already are facing a shortage and the Government of India is also very keen that this product is made in India because it is primarily reliant on imports. I think about — out of a demand of about 300,000 tonnes plus, about 100,000, 120,000 is supplied from India. The balance is imported. This demand is growing quite fast overall globally and in India as well. This CRGO facility has a technology which JSW Steel has acquired and that will be housed in distributed steel, while the joint venture has acquired the facility at Nasik. So this gives us a technical edge from a technology point of view as this technology is available with few in the world.
From a margin perspective, I would just say that this particular product is advanced technology product — so the prices are naturally higher since the investment is much higher, and the margins therefore, will be better. The capacity currently is at about 50,000 tonnes. We have enough land and we have enough possibility to expand. Our aim is that we would take this capacity up in the next one or two phases and increase this capacity. We will be able to give you some more color as to what once we go in fully and get in the full approvals in place.
Amit Dixit
Okay. So appreciate that. Thanks and all the best sir.
Ashwin Bajaj
Thank you.
Operator
Thank you. The next question is from the line of Alok Deora from Motilal Oswal. Please go ahead.
Alok Deora
Hi sir, good evening. Just couple of questions. So first is the debt has increased in this quarter. So just wanted to understand — where do we see — how do we see the debt moving ahead by the end of this year and next year?
Swayam Saurabh
Yeah, so debt has gone up. This is Swayam here. Debt has gone up by almost INR5,000 crores to INR85,000 crores odd. That is primarily because of some cash, which is locked in working capital, which Jayant explained initially. There is also two one-off cash outflow. We had — we paid dividend as well as we did an acquisition. So these are the basically main reasons why debt has gone up. Going into quarter three and quarter four with additional volume coming in, the debt in absolute terms should start to taper down. We are committed to the net debt-to-EBITDA ratio, which we have been communicating for last few quarters. Goal in mid term will be to bring it down to below 3%, ideally between 2.5% to 3%. But debt in absolute terms should start to taper down.
Alok Deora
Sure. And just on the NSR. So what we understand is that the prices have firmed up in October and even next month, some companies are looking to increase prices — but imports continue to remain elevated, which should kind of continue till November. So how do we see the NSR moving? Could it be more like just a INR500,000 kind of increase or could we see a sustained increase ahead in NSR as the demand picks up? Just some color on that. Thanks.
Jayant Acharya
So I think, Alok the point to understand is that the prices from the beginning of this April to September closing has fallen quite sharply. So today, the price levels at which most of the steel companies have been operating is not really sustainable. Therefore, we feel the prices have bottomed out. And now is going for an increase, which is mostly a natural increase, which was due. The demand in the second half because of a strong second half quarter, as I explained, will be a tailwind naturally. And that I think, usually in January, March, December, January, we do see price pickups normally happening. We have taken an increase in October for flat steel and long steel both. So we — it varies in the range of 1,000 to 2,000 depending on product to product. We are quite confident that this price increase will be sustainable. Cost will go down. So therefore, to that extent, in the quarter three, we will see some better spread. Iron ore price increase is — which has happened recently, is one area which we need to watch. We will see a coking coal decrease, which will help us in the cost. Other drivers of efficiencies will also help us. So we’ll keep an eye on the iron ore side as we go along into H2.
Alok Deora
Sure. That’s all from my side.
Jayant Acharya
I would just like to add is that, our mining operations in Karnataka were two mines and Goa, which will start, the BPSL mines at Netrabandha, which will start, these will automatically be much closer geographically and will give us a better product at a lower price, then that automatically will aid our overall iron ore average price.
Alok Deora
Sure. So that will come by from Q4 onwards?
Jayant Acharya
Yes. So yeah, so as we said, the BPSL Netrabandha mine, the Goa mine, and two mines in Karnataka. These mines we are expecting in Q4.
Alok Deora
Sure. Thank you. That’s all from my side. Thank you, all the best.
Operator
Thank you. The next question is from the line of Sumangal Nevatia from Kotak Securities. Please go ahead.
Sumangal Nevatia
Good evening. Thank you for the opportunity. My first question is on 2Q earnings. I just wanted to understand the movement quarter-on-quarter on realization and cost a little bit better because both realization and cost reduction is much sharper than what we were anticipating. So just if you could explain the movement.
Jayant Acharya
So basically, the mix of iron ore and coking coal, as we said, coking coal costs have gone down by about $27 per tonne. We have been able to lower the iron ore cost as well through a better mix of captive, reducing the logistics movement cost in our overall ecosystem for iron ore. Our overall cost of power and stores and spares both have come down, and our inventory impact also has been positive — has been lower. So therefore, I think all this combined has resulted into this number, which has offset the drop in NSR in overall.
Sumangal Nevatia
Okay. Understood, understood. With respect to iron ore, is it possible to share what is our this year’s mix of captive versus outside purchase maybe for the first half? And over the next one or two years, how are we seeing this change? And is it possible to quantify versus market purchase, how is it impacting our financials? Is it at the margin slightly negative and eventually with slurry pipeline, etc., turned positive or today itself, it is positive.
Jayant Acharya
Our captive use in this quarter has gone up slightly even on an increased volume of production. Our captive use was 41% versus 38% last quarter. So as we scale up our own mining assets, as we explained various assets, we will increase our captive views. But also keep in mind that our expansion. So our absolute number of iron ore from our captive will increase. But as a percentage, it may vary because as JVML capacity is fully ramp up, and BPSL capacity fully ramp up, the percentage may differ a little bit from quarter-to-quarter. But on an absolute number basis, yes, it will — our captive will keep increasing. Karnataka, as we said, we are hopeful to do 15.5 million tonnes from our own mining operations that, let’s say 15 million plus there. Orissa, even after surrendering Jajang, we have enough in the remaining three mines to be able to service our Eastern assets as well as move something to our Dolvi asset.
The slurry pipeline, which is already doing good progress, out of 300 kilometers, I think we have laid almost close to 170 kilometers. And I think we have welded closer to 190 kilometers already. So that’s a positive. This slurry pipeline would reduce our cost by about INR1,000 a tonne as we had guided last time, INR900,000 a tonne. Our mines in Goa, as we said also, the first one will start off soon. That will again go to Dolvi. That would again help the Dolvi cost. And the new mines in Karnataka, those two mines, which will at least start in the quarter four will again be positive for our own captive in Karnataka. So it will reduce logistics costs for us in Vijayanagar. It will reduce logistics cost in Dolvi because of the slurry pipeline. And please take into account that this cost of slurry pipeline reduction of 900 to 1,000 is on iron ore. So you have to put a multiplier impact for steel. And similarly, the asset quality because the new mines which are coming is at slightly better qualities. So therefore, the quality of iron ore input will be better, that should be positive for fuel efficiencies.
Sumangal Nevatia
Okay. So I mean in FY ’26, ’27, what is the quantum volumes, captive volumes are we looking at? Is it north of 30 million tonnes or something?
Jayant Acharya
Yeah, it should be more. I think we are probably [Speech Overlap] yeah, we will give you that color a little bit separately through the investor group, but it will be more than 30 million for sure.
Sumangal Nevatia
Understood. My next question is on coking coal.
Operator
Mr. Nevatia, may we request you to please rejoin the queue.
Sumangal Nevatia
Okay, all right. Thank you and all the best.
Operator
Thank you. The next question is from the line of Ritesh Shah from Investec. Please go ahead.
Ritesh Shah
Hi sir, thanks for the opportunity. A couple of quick questions. The first is you indicated on the working capital release in the second half, would it be possible for you to quantify the number, please?
Jayant Acharya
Yeah, we’ll not be able to do exact quantification, but it could be in the range of — it could be INR1,500 crores to INR2,000 crores.
Ritesh Shah
Okay. So despite if we assume it to be — even on the higher side, we are indicating that we will go ahead with the residual capex after taking it down to 16, and our net debt will reduce into the second half. Is the reading correct?
Jayant Acharya
Correct. Because second half, the volumes will go up. We have just guided that we’ll hold full year guidance that automatically means H2 volume will be higher, and that would mean incremental absolute EBITDA, which is going to be higher.
Ritesh Shah
Sure. My second question has two parts. One is for — I think both are for Jayant sir. One on iron ore and second is on coking coal. Iron ore, Jajang sir, can you please take us through the underlying reason why we are surrendering? I understand we have indicated non-viability, was it just because of the sizing or was it the distance of the mine from the plant because the premium what we have paid over here, I think it’s lower than a lot of other mines that we have paid for. So that was one. And secondly, on coal, possible to quantify some numbers on Illawarra tonnage and the total investment that we have made right now, incrementally, what is expected. And you indicated on sales around 2 million tonnes, what is the sort of pricing? And by when do we see the benefits of this?
Jayant Acharya
Yeah, okay. On the first one on Jajang iron ore mine, Jajang iron ore mine I think we bid at a time, a slightly higher premium. I think it was under 10% odd plus the priority, bid premium, etc. So total 127%. And there was also rail siding in that asset, and that was one of the reasons also it was helpful to move material. But over a period of time, what happened is that this particular asset was already used by the earlier lessee for the higher grades and what gradually got left behind is the lower grade. So as we started mining in the first one, two years, the grades of the higher level got finished and the lower grades came into surface — they have high alumina high silica both. So from a usability perspective, it was more difficult. So it was becoming uneconomical to really run it. We had to export quantity from here as well to be able to make up our MTPA. So we did not see economic sense in continuing it, and that is why we decided to surrender. We have enough assets in Orissa right now to be able to meet our requirement there. Also, this life of this mine also, which we had were only two years was left. So therefore, from a life perspective, also we did not have a long time.
Ritesh Shah
Sure, sir. And sir on coal.
Operator
Sorry to interrupt, Mr. Shah, may we request you to please rejoin the queue.
Jayant Acharya
I will just answer the question on coal, which you had already asked. On the coal side, coking coal, Illawarra, we have taken a 20% look through interest with an investment of $120 million. the offtake arrangement of about 1.2 million tonnes plus will start in FY ’26. This is a prime low volatile coal, which will come to us, which has been one of the volatile from a price perspective product. So better control of this asset will provide better stability to us.
The coking coal auctions in which we have recently acquired 2 million tonnes is the other question, I think, which you asked, is basically through an auction process, which is for 15 years, and this is on raw cooking coal — this net of yield will give us clean coking coal of approximately $1.1 million. Our current assets in the three mines, which we have should give us about $1.6 million. So both put together, we should be getting from domestic coking coal assets about 2.7% and 1.2% to 1.3% from Illawarra. So typically, about 4 million tonnes of coking coal. We have, by and large, been able to secure. That is the overall scenario for you.
Ritesh Shah
Sure sir. Thank you so much. I will join back the queue. Thank you.
Operator
Thank you. The next question is from the line of Ashish Kejriwal from Nuvama Institutional Equities. Please go ahead.
Ashish Kejriwal
Yeah, hi. Good evening everyone. Sir, my question is on iron ore. Is it possible to share how much iron ore we produced this quarter and last quarter? Because I understand that mining royalties paid on the iron ore that we produce and maybe because of this fact, if you look at on a per tonne basis, our EBITDA per tonne seems to be much higher than what it was expected. So is it possible to share that number sir. That’s my first question.
Jayant Acharya
Yeah, just give us a second. So from a production perspective, last quarter, our production was about 6.7 million tonnes, which was higher because we had to complete the MDPA especially for Orissa. In this quarter, our numbers are lower at about 5.1 million, 5.2 million tonnes because our MDPA requirements have been completed especially for the Orissa mines and therefore, the volume is slightly low.
Ashish Kejriwal
So sir, if you look at your mining royalty this quarter, is it just because of this lower volume or our royalty rates have also reduced and which will increase going forward. So what essentially — I mean to ask is that the EBITDA per ton outlook, which we have been giving, have we factored in the cost increase according to the captive iron ore mining royalty [Indecipherable]?
Jayant Acharya
So basically, lower volumes for sure is what I just mentioned. And IBM prices had dropped, so that resulted into lesser outflow on the royalty side. These were the two factors.
Swayam Saurabh
And just to add lower volume on Orissa side reduces this cost.
Jayant Acharya
[Speech Overlap] reduce Karnataka volume that’s what he meant.
Ashish Kejriwal
Okay. Sir, because — when I’m looking at from first quarter to second quarter, even if I include your total raw material costs and mining royalty, on a per tonne basis and compare it with the first quarter, it seems to be lower by around INR5,000, whereas you mentioned about coking coal, which is around $27 and some a bit of lower iron ore price. So I was just trying — I’m unable to get the delta which I think someone else also asked for this quarter?
Jayant Acharya
I think maybe our investor team can separately understand and explain to you, but lower exports of iron ore is something also which you have to take into your calculation because last time to complete the MDPA by June, in Orissa mines, there were some exports, which were at a lower number and that again had an impact. So last quarter, if you remember, we said that the mining impact was more, which this quarter has gone down. So factors are basically lower volume. IBM prices, which had rolled down, so therefore, the royalty premium value terms was lower and lower exports of iron ore, which was actually sharply down. So 2.3 million, 2.4 million, if I recall, which has come down in this quarter two to [Indecipherable]. That was the main reason.
Ashish Kejriwal
Okay. My second question is on account to prices, you highlighted that in October, we have taken a price increase. And as well as you have mentioned that in second half, we can increase our volumes and if I’m looking at a run rate should be more than 15%. So here, my question is, one, the blended iron ore — blended in-price in October is — in flat products. Is it higher or lower than our Q2 average? That’s one.
And secondly, when we are talking about India appliance steel consumption, we have seen that it has increased by around 11% Y-o-Y, whereas even our domestic sale has increased just by 1%. So even if, second half, how we are going to have 15% or 17% increase in volume growth? That’s my question.
Jayant Acharya
Let me answer your second part first. I think when you are looking at Y-o-Y, we had a liquidation of inventory on a lower production in the quarter before quarter two ’24, due to which the base was higher and that’s why you saw 1% increase. Whereas on a quarter-on-quarter basis, our sales basically were up in the domestic by 4.8%, close to 5% as against the India domestic growth of about 4%, 4.2%. So we are still doing well on that front. On the first half of this year also, our domestic sales, as I mentioned, was quite strong and the growth was quite strong. Going forward into the NSR, it’s difficult to give the full details in one this thing, but let me put it this way that we have taken a price increase, as I said, for flat and long both. We expect that the prices, which were very low in the month of September will — will not be sustainable, and therefore, the increase is something which is real and should be sustainable. This is one positive. The cost on coking coal will go down, and that would help. On an average, the NSR by and large for quarter two and quarter three, we would expect that we will be close in terms of stability on an average for quarter two, although we exited at a lower September rate, but on an average basis, we’ll be better because the product mix and the price increase which we have taken, both.
Ashish Kejriwal
Sure sir. Thank you and all the best.
Operator
Thank you. The next question is from the line of Kirtan Mehta from BOB Capital Markets. Please go ahead.
Kirtan Mehta
Thank you sir for the opportunity. We have indicated growth rate for several category of sales like institutional segments [Indecipherable], which are quite strong. Would we be able to indicate some quantum about this segment as well, how much they contribute — volumes they contribute?
Jayant Acharya
So it would be difficult to give you product wise segment wise. But from an overall, as I said, the institutional was very strong for the first half in which the institutional, we said our auto sales was positive. It grew by 6% Y-o-Y in the first half. Our solar sales were positive, they grew by 90%. Our overall renewable energy grew by 32%. If you were to look at solar and wind. Appliances grew by 65% Y-o-Y. Our branded sales have been stable in spite of the overall retail being impacted. Our branded sales grew marginally — modestly in good branded products. So by and large, I think we’ll be able to give you this flavor. Our exports have been down. That has been the major challenge, but I think we should look at it this way that — we have aligned our production and sales to the domestic market because the growth in the domestic market was very good, 13.5% growth in the first half of this year, which enabled us to reduce our export, which also was affected by a low demand and a low pricing environment. So that has again been a positive.
Kirtan Mehta
Sure, sir. And second question is more basically in the quarter two, while domestic sales growth was around 12% Y-o-Y at the country level, our growth was around 4%, 5%, which are the segments where we would have lost the market share?
Jayant Acharya
Sure. Domestic growth, 12%, you’re talking about the Y-o-Y again, right?
Kirtan Mehta
Yeah.
Jayant Acharya
So here, basically, the way I think we were to also look at it is between also flat and long separately. In the flats, our market shares are more or less stable. In longs, we are doing quite well, but our volume is 25% in our overall mix, 75% is flat. The main reason where we lost a little bit of market share is in the flat, which was primarily because of import. Import moved, as we said in this particular quarter to 3.2 million odd tonnes, and that was an increase over the last quarter. And our exports also reduced marginally. So these two combined had an impact of almost 1.2 million tonnes as a country, I’m talking, overall. So reduced exports by about 200,000 tonnes and exports going up — sorry, exports going down by 200,000 tonnes and import going up by 1 million tonnes. So 1.2 million tonne incremental availability. So imports basically replaced some part of the domestic demand. That impacted the share or flats, I think, overall. Other than that, I think we are, by and large, good in the country.
Swayam Saurabh
If I can just add. Last year, quarter two, as Jayant mentioned, we did almost 1.5 [Phonetic] lakh tonne of inventory liquidation. So if you look at last year quarter two, both production and sales were at 6.34% at [Indecipherable] level. if you exclude the base dilution impact, the growth in domestic will be actually 7.5%.
Jayant Acharya
And also, I think if you look at it from overall quarter-to-quarter perspective, the domestic India grew by 4.2%, where we grew by 4.8%. So this — apart from this one-off which Swayam explained, which is a variation in Y-o-Y you see quarter-on-quarter, whatever India has grown, I think we have done better.
Kirtan Mehta
Understood, sir. Just one question on the [Indecipherable]. Some of the Chinese companies have been indicating margin in the range of $1,000 per tonne. So would we be able to capture the margins in that range for our facility as well?
Jayant Acharya
So I would not like to comment at this stage on exactly giving you the margin, but directionally, I think this is a very high margin product. and absolutely right. So this is something which gives us a little bit more time to complete all the processes which are in the system, then we’ll be able to give you some more color.
Kirtan Mehta
Thank you sir.
Operator
Thank you. The next question is from the line of Amit Murarka from Axis Capital. Please go ahead.
Amit Murarka
Hi, thanks for the opportunity. So my question was around —.
Operator
Sorry to interrupt you Amit, can you speak a bit louder. We are unable to hear you clearly.
Amit Murarka
Yeah, is it better?
Operator
Yes, please go ahead.
Amit Murarka
Yeah, my question is around the overseas businesses. So like I think second half of last year and earlier this year also, we are seeing profitably coming in from [Indecipherable] as well as Plate & Pipe Mill. So could you just help us understand as to why things have deteriorated so much? And is this a new normal situation.
Jayant Acharya
As far as our subsidiaries in US is concerned, I think Ohio impact, I mentioned there was a shutdown which was not planned maintenance shutdown, which we had to take that resulted in lower volumes. The lower pricing environment overall internationally also affected the prices. Baytown, while it posted a positive EBITDA was lower than the previous quarter. But overall, because Ohio impact was more, there was a loss. In Italy, EUR6.2 million of EBITDA, slightly lower than the previous quarter, but the volumes were better. The prices were lower because of the international price scenario in general. Italy will continue to remain, I think, in terms of volume, it will remain good. I don’t see a problem — because from an asset side, it’s a rail asset, which is primarily driving the volumes, and that has a strategic content and therefore, will continue to remain in good demand. And I think the pricing will be better than other products per se. As far as US is concerned, I think we have seen a price improvement in Ohio, primarily because of the international market post the China stimulus and US has also improved. The post the shutdown, the facilities have started again. So the volume part in Ohio in this half will be back to normal. Baytown, the place prices haven’t improved as much as yet, but we are expecting some improvement as we go into quarter four. It would be — I would say it will be better than what we have performed in quarter two, for sure, but I would not be able to hazard a guess right now and give you a number on what kind of numbers could come.
Amit Murarka
No, I’m not looking for a number. I’m just trying to understand like you did about $100 million EBITDA in the Plate & Pipe Mill in ’23 and about $110 million in ’24 [Speech Overlap].
Jayant Acharya
Basically the pricing. So the prices, if you really look at, if the prices of the coils went down from, whatever, $900 plus to $600-plus per net tonne, which happened in US And then it has climbed now to again over $700 per tonne. So pricing really destroyed your margins, even plates if we were to look, I think, on a Y-o-Y basis, the pricing for plates have also come down. So Ohio, if I see on a Q-o-Q basis itself, price have come down by 15% and in Baytown, it had come down by about 10%, close to that. These are CRU numbers. So that was the basic impact. I think the pricing scenario now is improving. That will aid the margins to improve.
Amit Murarka
Sure. And just lastly, on the guidance, I think coking coal, you said $20, $25 for Q3, right?
Jayant Acharya
$20 to $25 for Q3, yes.
Amit Murarka
Okay, sure. That’s all. Thanks.
Operator
Thank you. The next question is from the line of Raashi Chopra from Citigroup. Please go ahead.
Raashi Chopra
Thank you. Just following up on a question asked earlier that there’s big delta on the realization per tonne differential between the first quarter and the second quarter as well as the expenses in the sense that the realization declined by about INR3,000, but if you actually divide the revenues by the volumes that number comes closer to INR6,000. So just so can you explain both on the revenue and the cost side by lower iron ore exports?
Swayam Saurabh
Yeah, iron ore export — lower iron ore export is one big reason. But broadly, the INR3,000 delta we negated as Jayant explained almost INR950,000, which is a combination of lower iron ore cost as well as lower Orissa losses. Then we had got in about $27 gain on coking coal. And we also saw other type of example, steam coal prices coming down. A number of other let’s say, efficiencies which — and lower inventory losses, which actually helped us cover the last house. That’s broadly what the split is.
Raashi Chopra
Got it. And then on the volume targets that you maintained, are they maintained individually as well like the Indian operation targets are still like the PAT target still 26 million tonnes for the year?
Jayant Acharya
The overall guidance, which we had given for 27 million tonnes was including consol basically for both and 28.4 million tonnes was also controlled including US operations. So both — the overall targets will maintain and individually, I’m not getting into detail right now, but I think overall, we are maintaining for sure. Because I think I would — because of the ramp-up of JVML, I’ll not be able to give you exact details as to how but 26 million, as you asked, Indian operations will certainly be there.
Raashi Chopra
Okay. And just one last question. Any guidance on the capex for next year since you reduced this year.
Jayant Acharya
Since we have reduced it this year. No, actually, capex what we have reduced is basically for two reasons. As I explained, one was the slurry pipeline transfer and the BFC postponement of the capex which both these put together have resulted primarily in this number. No critical projects have been cut as yet, we have not done anything like that. So therefore, this 20,000 to 16,000, 17,000 is only that number. So next year, going forward, our expenditure on Dolvi Phase 3, which is a critical asset which is going on our [Indecipherable] our slurry pipeline, our pellet plant in Orissa are all on track. The mining side, beneficiation, mining asset, operationalization, capex, all on track. There is no change in that.
Raashi Chopra
So the shortfall, this will just get added on to what you were targeting for next year? Is that a fair assumption?
Swayam Saurabh
Not necessarily. I think what Jayant is saying is anything which is critical or would add capacity, we will not slow it down. Exact cash, we’ll be able to guide perhaps in a subsequent quarter.
Jayant Acharya
Yeah, but the slurry pipeline transfer will be permanent because that is something which we are transferring out. So that will not come back. But BF-3, which we have postponed from now to next year, is something which will come as a capex next year. So when we take capex for next year into account, we will calibrate our capex accordingly, keeping that in mind.
Raashi Chopra
Thank you.
Operator
Thank you. Next question we will take from the line of Ashish Jain from Macquarie. Please go ahead.
Ashish Jain
Hi sir. Good evening. Sir, first, just a clarification on this the thyssen deal, the technology has come to JSW Steel and the asset has gone to the joint venture. Is that understanding right?
Jayant Acharya
Yes, the understanding is right.
Ashish Jain
So what is the like reason behind such structure? Like any — and what is the outlay for us for acquiring the technology out of that INR4,000 crores?
Jayant Acharya
So without getting into details of the breakup at this stage, but we basically wanted to acquired the technology and have it in distributed steel because CRGO, as we said, is a technology which is available with a few. It’s an advanced technology. We wanted to house in JSW Steel. JFE already has a CRGO technology in Japan. So therefore, for them, it was not required to house it in the joint venture.
Ashish Jain
Okay. Okay. Got it. Sir, secondly, in terms of the price outlook, just to clarify, you did say like we know September exit prices were pretty weak. And while we have taken as an industry, some price hike in October, do you expect Q3 realizations would be better sequentially. Is that what you referred to earlier in your comment.
Jayant Acharya
No, I’m not saying that. Yeah, I think that’s a point which is good to clarify. No, I’m not saying that. Basically, what I’m saying is that the September exit was weaker. The Q2 average was a little higher because the September fall was deeper. The increase which we are taking or which we have taken in October and a change in the product mix, which we expect should enable us to get to a similar average as quarter two. So therefore, the fall, which has happened in September, to that extent, basically, we are trying to see how to make up through a mix of price and product mix.
Ashish Jain
Got it. Got it. And sir, lastly, can you just quantify your EBITDA per tonne for Q2, given all this confusion on price decline and cost decline, which has happened this quarter. Can you just quantify the EBITDA per tonne for Q2 standalone.
Jayant Acharya
EBITDA per tonne for Q2 for console was –.
Ashish Jain
No, no standalone.
Jayant Acharya
Standalone, [Indecipherable].
Ashish Jain
Okay. that’s it. Got it thank you so much.
Operator
Thank you. Ladies and gentlemen, this was the last question for today. I would now like to hand the conference over to the management for closing comments.
Jayant Acharya
So thank you very much for being here today. As we said here that India continues to be a strong growth area internationally, globally. It’s a bright spot. We have seen the steel demand growing very well. First half, 13.5%. Keep in mind that the elections and the weather disruptions disrupted. In spite of that, we ended the first half with a 73 million tonnes odd demand. The second half is usually better. Last year, we ended the second half at 73 million, which we have done in the first half itself. So we are expecting that this year, the demand will finish at a range of 150 million or so.
Our total volumes from our new capacities will go up in H2 that will help us to play into this demand and that will give us an improvement in our absolute EBITDA numbers. On a product mix point of view, we have some downstream capacities, which will be utilized now with the HSMC coming in. So the product mix also will go into some bit of value added. Our iron ore mining operations will start in our Goa mines, our Netrabandha mines in BPSL and Karnataka, which should further aid our cost side. Capex we are, by and large, on track to complete all our projects. We expect that this year, we will be able to meet all the guidance’s which we have given, 27 million tonnes of sales and 28.4 million tonnes of production. The full production ramp-up for the new capacities will play out in FY ’26. So outlook, India positive, steel positive. JSW Steel also positive. Thank you.
Ashwin Bajaj
Thank you. Please contact us at Investor Relations if you have any further questions.
Operator
[Operator Closing Remarks]