Jindal Steel & Power Ltd (Q1 FY14)

India Infoline News Service | Mumbai |

JSPL’s stock has corrected sharply over the last few quarters on account of issues related to the allocation of coal blocks.

CMP Rs200, Target Rs340, Upside 70%

  • Standalone revenue of Rs34.2bn was inline with our estimate as the impact of lower volumes was offset by strong realisations

  • Blended steel realizations jumped 6.9% qoq to Rs47,416/ton, higher than expectations; but steel volume of 0.66mn tons was lower than estimate

  • Standalone power sales volumes declined on a qoq due to issues at Angul and higher internal consumption

  • Standalone operating profit of Rs8.5bn was higher than our estimate due to higher realisations

  • JPL’s power production continued to improve, registering a PLF of 100.1%

  • JSPL to consider buyback; near term positive

  • Earnings to take centre stage; Maintain BUY with a revised 9-month price target of Rs340      

Result table (Standalone)
(Rs mn)
Q1 FY14
Q1 FY13
% yoy
Q4 FY13
% qoq
Net sales
34,252
33,311
2.8
42,137
(18.7)
Material costs
(12,752)
(9,702)
31.4
(17,971)
(29.0)
Power and fuel costs
(2,240)
(2,955)
(24.2)
(2,436)
(8.1)
Personnel costs
(1,314)
(1,117)
17.6
(1,237)
6.2
Other overheads
(9,470)
(9,160)
3.4
(10,131)
(6.5)
Operating profit
8,477
10,377
(18.3)
10,363
(18.2)
OPM (%)
24.7
31.2
(640) bps
24.6
15 bps
Depreciation
(3,036)
(2,372)
28.0
(3,081)
(1.5)
Interest
(2,318)
(2,186)
6.0
(2,369)
(2.1)
Other income
63
122
(48.7)
1,358
(95.4)
PBT
3,185
5,942
(46.4)
6,271
(49.2)
Tax
(796)
(76)
942.4
(1,496)
(46.8)
Effective tax rate (%)
25.0
1.3

23.9

Adjusted PAT
2,389
5,865
(59.3)
4,775
(50.0)
Adj. PAT margin (%)
7.0
17.6
(1063) bps
11.3
(436) bps
Extra ordinary items
-
(5,741)
-
-
-
BSE 165.00 3.50 (2.17%)
NSE 164.95 3.15 (1.95%)

***Note: This is a NSE Chart

 

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