ICICI Securities research report on Jindal Steel & Power
JSPL’s Q4FY25 EBITDA of INR 22.8bn (up 11% QoQ/down 6% YoY) was 6% ahead of our estimates, but missed consensus estimates. Key points: 1) One-off impact of INR 2.3bn in Q4FY25. 2) Working capital unlocking of INR 31.5bn in FY25. 3) Q4FY25 sales volume rose 6% YoY to 2.13mnte. 4) Exceptional loss of INR 12.3bn in Q4FY25, mainly pertaining to the impairment of investment in its Australian subsidiary. 5) Consolidated net debt of INR 119.5bn, implying net debt/equity of 1.26x.
Outlook
Ahead, we expect JSPL to benefit from lower coking coal prices and better realisation. That said, management’s FY26 sales volume guidance of 8.5–9mnte seems a tad low. As a result, we prune our FY26E/FY27E EBITDA by 1–2%. Our revised TP works out to INR 905 (earlier INR 920) at 6.5x FY27E. Maintain HOLD.
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