Jindal Steel Q4 Results Review - Earnings Hit By Inventory Write-Down, Impairment In Subsidiary: Motilal Oswal

Motilal Oswal Report

Jindal Steel and Power Ltd. reported revenue of Rs 137 billion, down 5% YoY and 7% below our estimate of Rs 148 billion. Average selling price improved 3% QoQ to Rs 67,448/tonne.

Sales volumes stood at 2.03 million tonne, down 2% YoY and up 7% QoQ. Exports improved to 11% of total sales (5% in Q3 FY23).

Ebitda stood at Rs 22 billion, down 29% YoY and 22% below our estimate of Rs 28 billion. Ebitda was affected by an inventory write-down of Rs 2.5 billion and high iron ore costs. Ebitda/tonne stood at Rs 10,775 versus estimate of Rs 12,597.

Adjusted profit after tax fell 68% YoY to Rs 6 billion (our estimate Rs 14 billion) as depreciation expenses rose due to an impairment charge of Rs 2.5 billion in its Australian subsidiary.

Net debt stood at Rs 67 billion (down ~Rs 20 billion in FY23) and the net debt-to-Ebitda ratio stood at a comfortable level of 0.7 times. JSPL further reduced the debt in April 2023 and gross debt as of April-23 stood at ~Rs 90 billion.

JSPL has declared a final dividend of Rs 2 per share for FY23.

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