SAIL To Increase Capacity, Improve Operational Efficiency In FY26

New Delhi, June 5, 2025:  Steel Authority of India Limited (NSE: SAIL | BSE: 500113) has announced that it is gearing up for a strong FY26, following a strong recovery in Q4 FY25 and plans to ramp up capacity, improve operational efficiency, and capitalise on growing domestic demand.

The state-run steelmaker recently announced its financial results for the fourth quarter and the full year, with significant improvements across key financial and operational metrics. SAIL delivered its highest-ever quarterly sales volume, aided by inventory reduction. Margins also improved, due to softening imported coal prices and a marginal uptick in steel realisations. It also outlined a medium-term growth trajectory toward a 35 million tonnes per annum (MTPA) steel capacity by 2030.

SAIL’s Strong Q4 FY25 Performance: Sequential Growth Across the Board

FY25 Financial Snapshot

SAIL’s FY26 Guidance and Strategic Outlook

• Capex Plan: ₹7,500 crore allocated for FY26, part of a phased investment plan to expand capacity to 35 MTPA by 2030, up from the current 20 MTPA.
• Sales Target: Crude steel production target for FY26 is 20+ MT, with improved finished product mix and lower semi-finished share (~10–12%).
• Debt Reduction: SAIL aims to continue reducing borrowings via internal accruals, following a ₹750 crore reduction in FY25.
• Employee Cost Control: Expected to decline by ₹400–₹500 crore in FY26 due to natural attrition and operational rationalisation.
• Raw Material Strategy: New pellet plants on BOO basis are expected to optimize ore usage. Bhilai’s pellet plant will be operational shortly, with Rourkela and Durgapur in the tendering stage.

How Did The Investors React? 

The investors reacted positively to the news as SAIL’s share price increased by 1.11%, up by ₹1.46 and the shares were trading at ₹133.29 at around 12:38 PM during the market session on June 5. The shares made an intraday high of ₹134 and a low of ₹131.83.

What Did SAIL’s Management Have To Say?

“We’ve demonstrated strong operational control and are on track to scale capacity while maintaining cost competitiveness. FY26 will see continued focus on volume growth, value-added products, and expansion execution,” said Dr. Ashok Panda, Director (Finance), SAIL.

He further highlighted that the recent safeguard duty, declining coal prices, and infrastructure push from the government are likely to support stable realisations and healthy margins post-monsoon.

SAIL’s Environmental & Technological Drive

SAIL has reduced its specific CO₂ emissions by 3% year-over-year (YoY) and continues to pursue decarbonisation through Memorandam of Understanding (MoUs) with global technology providers. The company is also integrating automation and AI to improve efficiency and reduce manpower costs in new expansions.

Looking Ahead

SAIL’s FY26 outlook appears promising with a strong push toward expanding capacity, reducing debt, and improving margins through efficiency and cost control. If domestic demand remains robust and execution stays on track, the company is well-positioned for sustained growth and improved profitability.

REF: https://www.bseindia.com/xml-data/corpfiling/AttachLive/7ad1ba16-488e-43d9-8e70-3fed7a9a57c9.pdf

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