JSW Steel Ltd's Q3FY19 consolidated net profit declines 18.1% yoy to Rs1,603cr: Misses Estimates

The company’s consolidated revenue stood at Rs20,318cr, up 13.8% yoy, but down 5.73% qoq.

Feb 06, 2019 10:02 IST India Infoline Research Team

JSW Steel Ltd Q3FY19

Consolidated Results Q3FY19: (Rs. in cr)

Q3FY19 YoY (%)
Revenue 20,318 13.8
EBITDA 4,501 16.9
EBITDA Margin (%) 22.2 59
Net Profit (adjusted) 1,603 [18.1]
***EBITDA margin change is bps

JSW Steel Ltd missed estimates for Q3FY19 on the revenue and earnings fronts due to lower sales volumes. Revenue grew by 13.8% yoy to Rs20,318cr (expectation Rs21,268cr). EBITDA stood at Rs4,501cr, up 16.9% yoy against estimates of Rs4,438cr. EBIDTA margin rose by 59bps yoy to 22.2%. Net profit stood at Rs1,603cr, a decrease of 18% yoy, against an estimate of Rs1,802cr.
  • Total steel sales rose to 3.68mn tonnes, down 7.3% yoy. Volumes for long and flat products fell by 1% yoy and 7% yoy, respectively. Sales of Value Added Special Products (VASP) stood at 54% of sales in Q3FY19. Sales to the Auto sector rose 23% yoy, while exports declined 70% yoy.
  • Production and sales for JSW Steel Coated Products stood at 0.42mn tonnes each for the quarter. Revenue and EBITDA for JSW Steel Coated products in Q3FY19 stood at Rs2,964cr (down 8% yoy) and Rs97cr (up 4.5% yoy), respectively.
  • Net Debt to Equity at the consolidated level stood at 1.4x in Q3FY19 against 1.46x in Q2FY19. Net Debt to EBITDA at the consolidated level stood at 2.32x in Q3FY19 against 2.35x in Q2FY19.
  • During Q3FY19, the following projects were completed:
    • 1.5mtpa coke oven at Dolvi began commercial production
    • 0.25mtpa tinplate line at Tarapur began trial production
    • Pipe conveyor at Vijayanagar began trial runs
    • The project to enhance Dolvi capacity from 10mtpa to 10.66mtpa is under review and pending required environmental clearance

Technical View:

JSW Steel Ltd ended at Rs. 279.30, up by 5.65 points or 2.06% from its previous closing of Rs. 273.65 on the BSE.
The scrip opened at Rs. 274.40 and touched a high and low of Rs. 282.60 and Rs. 271.55 respectively. A total of 60,41,313 (NSE+BSE) shares were traded on the counter. The stock traded above its 200 DMA.

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