International credit rating agency Moody’s has said in a report that major Indian steelmaker JSW Steel Limited (JSW) is likely to post significantly improved earnings in the financial year 2016-17, ending on March 31, 2017.
Moody’s expects JSW’s earnings to improve because of a 24 percent rise in saleable steel volumes to 15 million mt from 12.13 million mt in the fiscal year 2015-16 thanks to an enriched product mix, support for steel prices from protectionist measures and ongoing cost savings. According to Moody’s, while JSW’s full-year operating results were weak year on year, the March quarter performance showed a substantial improvement over the previous quarter. Moody’s also expects JSW’s EBITDA in the June quarter to increase 10-20 percent quarter on quarter.
However, Moody’s also stated that these results have no immediate impact on the company's rating or negative outlook, because the company yet needs to improve its leverage consistent with its Ba3 corporate family rating.