JSPL may post Q2 loss at Rs 400 cr on lower EBITDA: Poll

Jindal Steel & Power (JSPL) is likely to post loss of Rs 400 crore during July-September quarter against profit of Rs 442 crore in year-ago period, according to analysts polled by CNBC-TV18. It will announce earnings on November 14.

Lower operating profit (EBITDA), higher depreciation and interest charges may lead to a loss during the quarter.

Revenue is seen declining 10 percent to Rs 4,620 crore in second quarter compared to Rs 5,143 crore in same quarter last fiscal.

Analysts feel steel business revenue may be aided by steep increase in pellet volumes but operating profit may be under pressure due to weak realisations year-on-year.

JSP’s power EBITDA may improve sequentially in Q2FY16 from higher generation at Tamnar I and II on better coal availability.

Raw material cost may decline due to lower iron ore/coking coal costs.

Operating profit is likely to drop 39 percent year-on-year to Rs 997 crore and margin may contract 1000 basis points to 22 percent in quarter gone by.

According to analysts, earnings is not a big trigger for the stock. Important trigger is outcome of court case pertaining to coal blocks that were won in the auction & then cancelled. Currently JSPL has not secured itself for both power and steel operations.