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India Equity Research Reports, IPO and Stock News
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• Diversified pipe play on broad pick-up in capex (pipeline,
upstream, water infrastructure)
• Reviving structural trends in the SAW and DI pipe
• The largest Indian pipe company by capacity (2.43m tonnes in
FY12), post DI expansion (Abu Dhabi); DI to leverage water infra
spend
• Potential development of an iron ore mine (proven resources of
200 mn MT); upsides from Jindal ITF positives in long term
• JSL operational metrics to pick up from FY12E; sales volume and
earnings growth at an average 18% through FY12-13E, FY12E
ROIC of 23.1%
• Limited triggers over the next 2 quarters may keep stock
performance muted; however investors could view any
weakness as an additional buying opportunity.
• Shareholding: promoters – 46%
• Valuation: SOTP valuation (includes DCF-based valuation of
Rs172 for the core business and Rs33 for investments). We
assume a WACC of 13.1% and terminal sales growth of 2%.
Implied FY13E PE is 7.7x
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