JSW Steel shares continued their upward trend on 30 September, ending 2.82% higher at ₹1030 on the Bombay Stock Exchange (BSE). This marked the third consecutive session in which the stock closed above ₹1000, demonstrating a strong performance in the share market investment sector. The stock had closed at ₹1001.70 in the previous session, indicating a solid gain for investors.
Record performance and strong trading volume
JSW Steel's stock hit a record high for the second consecutive session amid a rally in metal stocks. On 30 September, a total of 1.67 lakh shares were traded, generating a turnover of ₹17.10 crore on the BSE. The company's market capitalisation surged to ₹2.51 lakh crore, further solidifying its position as a key player in the Indian steel industry.
The stock has also shown a 32% return over the past year, making it a favourable option for investors in the share market investment space. Year-to-date, the stock has risen by 17%, adding further optimism to its growth prospects.
Technical indicators signal strength
From a technical perspective, JSW Steel’s relative strength index (RSI) currently stands at 66, which suggests that the stock is neither overbought nor oversold. This provides investors with confidence that the stock is trading at a sustainable level, not prone to significant short-term corrections.
Furthermore, the stock is trading above key moving averages—5-day, 10-day, 20-day, 50-day, 100-day, 150-day, and 200-day—reinforcing its bullish outlook.
Brokerage recommendations
Various brokerage firms have provided positive recommendations for JSW Steel. Motilal Oswal has maintained its ‘buy’ rating for the stock, with a price target of ₹1,100. The brokerage highlighted JSW Steel’s plans to increase its reliance on captive iron ore mines, which currently meet 35% of its needs.
The company also aims to maintain a high value-added product (VAP) share, which was 64% of total volumes in the first quarter of FY25. Even after upcoming expansions, JSW Steel's management is committed to keeping the VAP share above 50% in the long term.
ICICI Securities also shares a positive view on the metal stock, setting a price target of ₹1,140. This recommendation stems from the overall positive outlook for the steel sector in India, particularly as the demand for steel continues to rise in infrastructure and construction.
Macquarie’s outlook on JSW Steel
Global brokerage Macquarie upgraded its outlook for JSW Steel on 20 September, moving from ‘neutral’ to ‘outperform’ and raising its price target to ₹1,077 from a previous target of ₹884. This upgrade reflects Macquarie's positive outlook on India's metal sector and the improving financial health of JSW Steel.
Financial performance in Q1 FY25
Despite these optimistic projections, JSW Steel reported a significant 64% decline in net profit for the first quarter of FY25, with profits attributable to owners amounting to ₹867 crore. Revenue from operations reached ₹42,943 crore, slightly higher than ₹42,213 crore in the same period last year.
However, the company’s EBITDA (earnings before interest, taxes, depreciation, and amortisation) saw a 22% year-on-year decrease, amounting to ₹5,510 crore. Margins also fell by 390 basis points, settling at 12.8%.
Future outlook
While JSW Steel faces short-term challenges, its strong technical indicators and continued demand for steel position it as a valuable long-term investment. With supportive brokerage recommendations and ongoing expansion plans, JSW Steel appears poised for future growth, making it an attractive option for investors looking for reliable returns in the share market.
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