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Jai Balaji: Buy; PT Rs450
�� The company expects its coking coal (Rohne 17mn MTPA) and non-coking
coal plants (Dumri - 37mn MTPA) to become operational by FY12 end to
provide raw material security.
�� The company's coke oven plant of 0.26mn MTPA is on track and is expected
to get commissioned by Nov 2011.
�� The company plans to achieve its earlier capacity utilization level of 75-78%
which had fallen to 67% last year due to bottlenecks.
�� The company already has funding in place for Phase 1A of its Purulia
expansion project requiring investment of Rs18.7bn (Rs6bn through internal
accruals and Rs12.7bn through debt) and expects to complete it by 2Q of
FY14.
�� The Phase 1B of Purulia expansion project requires an investment of Rs
25bn and it will increase the company’s capacity to 3mn tonnes by FY16.
�� The company presently has leverage of 1.67x (excluding Rs12.7bn debt
required for Purulia expansion) and expects the leverage to peak at 1.9x till
which level the company is comfortable.
The company made an EBITDA of $115 per tonne last year and targets to
increase it to $250 per tonne with the commissioning of its backward
integration facilities which is expected to provide significant cost savings.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Jai Balaji: Buy; PT Rs450
�� The company expects its coking coal (Rohne 17mn MTPA) and non-coking
coal plants (Dumri - 37mn MTPA) to become operational by FY12 end to
provide raw material security.
�� The company's coke oven plant of 0.26mn MTPA is on track and is expected
to get commissioned by Nov 2011.
�� The company plans to achieve its earlier capacity utilization level of 75-78%
which had fallen to 67% last year due to bottlenecks.
�� The company already has funding in place for Phase 1A of its Purulia
expansion project requiring investment of Rs18.7bn (Rs6bn through internal
accruals and Rs12.7bn through debt) and expects to complete it by 2Q of
FY14.
�� The Phase 1B of Purulia expansion project requires an investment of Rs
25bn and it will increase the company’s capacity to 3mn tonnes by FY16.
�� The company presently has leverage of 1.67x (excluding Rs12.7bn debt
required for Purulia expansion) and expects the leverage to peak at 1.9x till
which level the company is comfortable.
The company made an EBITDA of $115 per tonne last year and targets to
increase it to $250 per tonne with the commissioning of its backward
integration facilities which is expected to provide significant cost savings.
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