Accumulate Jindal Stainless; target of Rs 836: Prabhudas Lilladher

Prabhudas Lilladher recommended accumulate rating on Jindal Stainless with a target price of Rs 836 in its research report dated August 02, 2024.

Broker Research

August 02, 2024 / 12:33 IST

Accumulate

26 Aug, 2025 12:21

Volume

Todays L/H

Prabhudas Lilladher's research report on Jindal Stainless

Jindal Stainless (JDSL) reported weak but better-than-expected standalone operating performance in 1QFY25. EBITDA per ton improved 20% QoQ from weak 4QFY24 levels on the back of uptick in nickel prices, and focus on highmargin grades. Although key export markets such as Europe and the US are experiencing softer demand and higher freight costs due to the Red Sea crisis, mgmt. is focusing on newer markets such as Japan, S Korea and MENA region. Domestic volume growth remained strong at 14.3% YoY during the quarter affected by general elections. With GoI’s persistent focus on infrastructure development and rising railway capex, we expect JDSL to deliver strong 15%+ CAGR over FY24-26E as it has adequate capacity. With NPI and Chromeni assets getting commissioned in 2HFY25, JDSL is set to deliver the best volume growth in the metals space. Mgmt. increased its FY25 capex guidance to Rs55bn post acquisition of pending 46% stake in Chromeni.

Outlook

At CMP, the stock is trading at 10.5x/8x EV of FY25E/FY26E EBITDA. We upgrade the stock to ‘Accumulate’ from ‘Reduce’ rating with revised TP of Rs836 (earlier Rs712) valuing at 9x EV of Mar’26E EBITDA from 7x earlier. Higher imports and any deterioration in developed economies remain key risks to our estimates.

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