Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Key Takeaways
FY12 saleable steel production target unchanged at 8.5mt
JSW Steel (JSTL) has maintained its FY12 production target of 8.5mt despite a recent
ban on iron-ore mining in Bellary district. The CEC recently recommended to the Supreme
Court that iron ore production in Chitradurga and Tumkur districts also be stopped to
prevent illegal mining and further damage to the environment. The Supreme Court
verdict is awaited but JSTL is optimistic about its steel production target. JSTL believes
that there is iron ore inventory of ~25mt in the system, which will be available for sale
and thus production in the state will not be affected.
Average cost of iron ore to increase by INR500/ton
Per ton average cost of iron ore is expected to increase by INR500 and margins are
expected to hover around USD170 per ton in FY12.
Volumes, margins to be affected; Timely ramp up by NMDC may help
We believe that volumes and margins will be affected due to the closing of mines in
Karnataka. Although NMDC has been allowed to mine up to 12mt a year in the state, we
do not expect NMDC to ramp up production adequately in FY12. Maintain Sell.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Key Takeaways
FY12 saleable steel production target unchanged at 8.5mt
JSW Steel (JSTL) has maintained its FY12 production target of 8.5mt despite a recent
ban on iron-ore mining in Bellary district. The CEC recently recommended to the Supreme
Court that iron ore production in Chitradurga and Tumkur districts also be stopped to
prevent illegal mining and further damage to the environment. The Supreme Court
verdict is awaited but JSTL is optimistic about its steel production target. JSTL believes
that there is iron ore inventory of ~25mt in the system, which will be available for sale
and thus production in the state will not be affected.
Average cost of iron ore to increase by INR500/ton
Per ton average cost of iron ore is expected to increase by INR500 and margins are
expected to hover around USD170 per ton in FY12.
Volumes, margins to be affected; Timely ramp up by NMDC may help
We believe that volumes and margins will be affected due to the closing of mines in
Karnataka. Although NMDC has been allowed to mine up to 12mt a year in the state, we
do not expect NMDC to ramp up production adequately in FY12. Maintain Sell.
No comments:
Post a Comment