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P e r f o r m s w e l l o p e r a t i o n a l l y …
On the operational front, JSW Steel’s quarterly performance in Q3FY12
was better then our expectation. On a YoY basis, crude steel production
volume and sales volume increased by 19% and 20%, respectively. For
Q3FY12, on a standalone basis, the company reported net sales of |
7859.6 crore (higher by 36.2% YoY and 3.1% QoQ). The EBITDA margin
declined 106 bps QoQ and 139 bps YoY to 15.9%. Consequently, the
EBITDA for the period under review stood at | 1252.6 crore (higher by
25.2% YoY but lower by 3.4% QoQ). On account of depreciation in the
value of the rupee against the US dollar over the last three months, the
company reported a translational net loss of | 500.11 crore on
restatement of foreign currency monetary items at the close of the
quarter, which was exceptional in nature. The ensuing PAT stood at |
168.2 crore after taking into account the exceptional item. It has to be
noted that the company has announced the standalone numbers while
consolidated numbers would be declared in the next few days.
ƒ Robust sales volumes
In Q3FY12, JSW Steel reported crude steel production of 1.94
million tonnes (MT), which was 19% higher YoY. Sales volumes
during the period under review stood at 1.91 MT, which was a
healthy 20% higher on a YoY basis. Despite the concerns regarding
supply of iron ore, during the quarter under review the company
operated at ~72% capacity utilisation level wherein the capacity
utilisation for December 2011 was at a healthy 84% level.
V a l u a t i o n
At the CMP of | 631, the stock is trading at 6.0x and 5.6x its FY12E and
FY13E EV/EBITDA, respectively. Over the last couple of years, JSW Steel
had rapidly expanded its capacity and reported healthy growth in its
volume numbers (CAGR of 33% in FY09-FY11). We have valued the stock
at 5.5x its FY13 EV/EBITDA and arrived at a target price of | 595 and
assigned a HOLD rating to the stock.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
P e r f o r m s w e l l o p e r a t i o n a l l y …
On the operational front, JSW Steel’s quarterly performance in Q3FY12
was better then our expectation. On a YoY basis, crude steel production
volume and sales volume increased by 19% and 20%, respectively. For
Q3FY12, on a standalone basis, the company reported net sales of |
7859.6 crore (higher by 36.2% YoY and 3.1% QoQ). The EBITDA margin
declined 106 bps QoQ and 139 bps YoY to 15.9%. Consequently, the
EBITDA for the period under review stood at | 1252.6 crore (higher by
25.2% YoY but lower by 3.4% QoQ). On account of depreciation in the
value of the rupee against the US dollar over the last three months, the
company reported a translational net loss of | 500.11 crore on
restatement of foreign currency monetary items at the close of the
quarter, which was exceptional in nature. The ensuing PAT stood at |
168.2 crore after taking into account the exceptional item. It has to be
noted that the company has announced the standalone numbers while
consolidated numbers would be declared in the next few days.
ƒ Robust sales volumes
In Q3FY12, JSW Steel reported crude steel production of 1.94
million tonnes (MT), which was 19% higher YoY. Sales volumes
during the period under review stood at 1.91 MT, which was a
healthy 20% higher on a YoY basis. Despite the concerns regarding
supply of iron ore, during the quarter under review the company
operated at ~72% capacity utilisation level wherein the capacity
utilisation for December 2011 was at a healthy 84% level.
V a l u a t i o n
At the CMP of | 631, the stock is trading at 6.0x and 5.6x its FY12E and
FY13E EV/EBITDA, respectively. Over the last couple of years, JSW Steel
had rapidly expanded its capacity and reported healthy growth in its
volume numbers (CAGR of 33% in FY09-FY11). We have valued the stock
at 5.5x its FY13 EV/EBITDA and arrived at a target price of | 595 and
assigned a HOLD rating to the stock.
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