ICICI Securities research report on Jindal Stainless
JSW Steel (JSTL)’s Q2FY24 performance was ahead of our estimates. Key points: 1) Standalone EBITDA/te at INR 12,750 surpassed estimates on lower iron ore and coking coal cost. 2) Overseas subsidiaries posted mixed performance. 3) Enhanced focus on more profitable domestic market and increased sales to value added segments. 4) Net debt rose to INR 692bn due to the JISPL merger. Management retained its sales volume guidance of 25mtpa for FY24 and reiterated its target of reaching 50mtpa capacity by FY30.
Outlook
Taking cognizance of additional volume from BPSL from end-FY24, we raise our FY25E EBITDA by 2%, resulting in a revised TP of INR 775 on an unchanged 6.6x FY25E EBITDA. Maintain HOLD.
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