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India Equity Research Reports, IPO and Stock News
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Fuel security assured for 2400MW with PMOs recent directives on FSAs: The
new FSAs will assure coal availability for a period of 20 (earlier 5) years at 80%
(earlier 50%) of the requirement. The enhanced domestic coal availability would
marginalize Jindal Power’s dependence on supplies expected from captive mines
in Mozambique and Indonesia for its upcoming 2400MW power plant (expected
during H2FY14) in Chhattisgarh with all-round profitability improvement.
Mining lease for Utkal B1 coal mine struck: Grant of mining lease for Utkal B-1
coal mine (capacity of 6mtpa) is struck due to Govt. of Odisha’s demand for 33%
of the power generated from washery rejects at free of cost. Otherwise, the
company has secured all other clearances and also acquired ~75% of the
required land. The mine would feed steel plant’s entire coal requirement, while
would meet 50% of power plant’s requirement. Hence, the activity on the coal
mine would stand as the most crucial milestone for profitability of JSPL’s
810MW (135MWX6) and 1.6mtpa steel plant at Angul, Odisha. We expect 1.5m
tonnes of coal production from these mines in FY14.
Production from overseas coal assets still far away: On the backdrop of average
quality of Indonesian coal mines, increased regulatory intervention and logistics
bottlenecks in Mozambique, we don’t expect any meaningful contribution from
overseas coal assets in the next couple of years.
Downgrade to Reduce with TP of Rs625: Given the sharp run-up in the stock
price and expensive valuations, we downgrade our rating on the stock from
‘BUY’ to ‘Reduce’ with TP of Rs625. However, we continue to like JSPL’s strong
structural play on resources and attractive returns profile.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Fuel security assured for 2400MW with PMOs recent directives on FSAs: The
new FSAs will assure coal availability for a period of 20 (earlier 5) years at 80%
(earlier 50%) of the requirement. The enhanced domestic coal availability would
marginalize Jindal Power’s dependence on supplies expected from captive mines
in Mozambique and Indonesia for its upcoming 2400MW power plant (expected
during H2FY14) in Chhattisgarh with all-round profitability improvement.
Mining lease for Utkal B1 coal mine struck: Grant of mining lease for Utkal B-1
coal mine (capacity of 6mtpa) is struck due to Govt. of Odisha’s demand for 33%
of the power generated from washery rejects at free of cost. Otherwise, the
company has secured all other clearances and also acquired ~75% of the
required land. The mine would feed steel plant’s entire coal requirement, while
would meet 50% of power plant’s requirement. Hence, the activity on the coal
mine would stand as the most crucial milestone for profitability of JSPL’s
810MW (135MWX6) and 1.6mtpa steel plant at Angul, Odisha. We expect 1.5m
tonnes of coal production from these mines in FY14.
Production from overseas coal assets still far away: On the backdrop of average
quality of Indonesian coal mines, increased regulatory intervention and logistics
bottlenecks in Mozambique, we don’t expect any meaningful contribution from
overseas coal assets in the next couple of years.
Downgrade to Reduce with TP of Rs625: Given the sharp run-up in the stock
price and expensive valuations, we downgrade our rating on the stock from
‘BUY’ to ‘Reduce’ with TP of Rs625. However, we continue to like JSPL’s strong
structural play on resources and attractive returns profile.
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