JSW Steel is one of the largest privately-owned steel producing companies in India. JSW Steel is part of the JSW Group which is a multi-billion-conglomerate. JSW stands for Jindal South West.
As of March 2018, JSW Steel has a market capitalisation of about Rs.68,500 crore.
Wealth and recent performance
JSW Steel Q1 FY 2018-19 Results
- The steel producer reported nearly a four-fold increase in its consolidated net profit to Rs.2,339 crore attributed by better realisation and higher sales. The company had posted Rs.624 crore during the same period last fiscal.
- The consolidated revenue from operations inclined by 25.3% y-o-y to stand at Rs.20,519 crore.
- It said that its domestic sales volumes increased by 27% y-o-y, while its sales to the automotive segment inclined by 57%.
- The steel manufacturer’s consolidated EBITDA rose to stand at Rs.5,105 crore and the EBITDA margin came in at 24.9%, nearly 700 basis points higher.
- The company reduced its net debt to 1.32 times its equity capital, declining from 1.38 times for the quarter ending on 31 March 2018. Its net was about 2.26 times its EBITDA.
JSW Steel FY 2017-18 Annual Report
- The company reported a rise in its revenue from operations which grew by 16% at Rs.66,234 crore as against Rs.56,913 crore during last fiscal.
- Its operating EBITDA also grew by 19% at Rs.13,741 crore as against Rs.11,544 crore during last financial year.
- The steel manufacturer reported a rise in its Profit Before Exceptional Items by 42% to Rs.7,309 crore as compared to Rs.5,131 crore last year.
- Its PAT inclined as well by 29% at Rs.4,625 crore as against Rs.3,577 crore during last fiscal.
- The Earnings Per Share (EPS) grew by 29% to Rs.19.14 while it was Rs.14.80 last fiscal.
- Its domestic turnover inclined by 18% to Rs.53,380 crore as against Rs.45,322 crore reported last fiscal, while its export turnover grew by 7% to stand at Rs.11,666 crore as compared to Rs.10,922 crore.
JSW Steel Q4 FY 2017-18 Results
- The company posted a three-fold rise in its consolidated net profit to Rs.2,879 crore for the said quarter as against Rs.1,008 crore reported during the same period last fiscal.
- Its consolidated total income rose by 16% to Rs.20,862 crore compared to Rs.17,973 crore in the same quarter last year.
- The total expenses inclined to Rs.17,275 crore during Q4 FY18 as against Rs.16,578 crore in the corresponding quarter last year.
- In a statement, the company said it achieved its highest ever crude steel production for the said quarter at 4.31 million tonnes, growing by 5% y-o-y. Also, it said that it achieved the highest ever quarterly sales volume of 4.22 million tonnes attributed to strong domestic demand.
JSW Steel Q3 FY 2017-18 Results
- According to the unaudited standalone financial results for the third quarter of the financial year ending 2017–2018, the total income of JSW Steel rose from Rs.15,035 crore in the second quarter to, Rs.16,496 crore in the third quarter.
- The total income for the third quarter of the FY18 was more than the total income for the corresponding period in FY17 at Rs.14,661 crore.
- While total expenses of JSW Steel rose from Rs.13,750 crore in the second quarter of FY18 to Rs.14,541 crore in the third quarter of the same year. This was an increase in expenses compared to the third quarter of FY17 at Rs.13,469 crore.
- The profit before tax for the third quarter of FY18 was Rs.1,721 crore. The profit before tax for the previous quarter was, Rs.1,285 crore. The profit before tax for the third quarter of FY17 was Rs.1,192 crore.
- The net profit after tax was Rs.1,126 crore for the third quarter of the FY18, while it was Rs.845 crore for the second quarter of the same financial year. The net profit after tax for the third quarter of the FY17 was Rs.819 crore.
Stock trend in 2018
- In January 2018, JSW Steel’s stock began trading at about Rs.265. The first week saw the stock steadily increase with a peak of about Rs.286. The stock continued on a more or less linear path for the next two weeks. The high for the month was about Rs.294. The stock closed for the month at about Rs.289.
- The beginning of February 2018 saw the stock spike to about Rs.302. This was followed by a steep decrease in price, but the stock recovered again. From the second week of February to about the end of February, the stock largely remained over Rs.300. There were two days in between during which the stock dipped briefly below Rs.300 but the stock regained in price. The peak for the month was about Rs.318. The stock ended the month at about Rs.312.
- In March 2018, the stock opened at about Rs.305. In March, the stock dropped to below Rs.300 and remained in that range for the most part. The stock rose above the Rs.300 mark for about two days but dipped again after that. The closing price on 22 March 2018 was about Rs.286.
- The scrip rose by 7 points on the 2nd of April to stand at Rs.296.55 and continued to incline significantly to end the month at Rs.325.00.
- However, it lost more than 10 points on the 2nd of May to stand at Rs.315.15. It gained more than 20 points to Rs.336.60 on the 16th and dropped further by the end of the month to close at Rs.331.90.
- On the 4th of June, JSW Steel stock price stood at Rs.331.85 only to drop more than 5 points to end the month at Rs.326.80.
- When the market opened for trading on the 2nd of July, the scrip lost more than 13 points to end the day at Rs.313.40 and continued to fall to touch Rs.296.20 on the 18th; however, it gained by the end of the month to close at Rs.330.40.
- On the 1st of August, the stock dropped 3 points to end the day at Rs.327.55 and by the end of the month, the scrip rose significantly to end at Rs.396.35.
Stock history (2016–2017)
- JSW Steel’s stock began trading at about Rs.102 in January 2016. Till about the second week of January, the stock largely remained between Rs.100 and Rs.110. This changed after the second week when the stock dipped to about Rs.97. Towards the end of the month though, the stock regained in price to reach a peak price of about Rs.112. The stock closed for the month at about Rs.105. The stock opened in February 2016 at about the same amount. The stock dipped again to below Rs.100 in February but gained in price to remain over Rs.100 for the rest of the month. The peak for the month was about Rs.112. This was close to the price the stock closed at for the month. March 2016 saw another hike in prices to about Rs.114. The stock gained steadily for the rest of the month to achieve a peak of about Rs.128 at which price it closed for the month. There were close to no dips in price in March.
- In April 2016, the stock opened at about Rs.126. The stock climbed slowly for the rest of the month, with a high of about Rs.137. This was about the price the stock closed at for the month. In May 2016, the stock opened at a price of about Rs.136. The stock then steadily dipped till about the second week of the month. The lowest price for the month was about Rs.126. The stock gained steadily after this, to close for the month at about Rs.138. This was also the highest price for the month. In June 2016, the stock began trading at about Rs.137. This was followed by a week of linear performance. By 9 June 2016, the stock had breached the Rs.140 mark. For the rest of the month, the stock largely remained above Rs.140 with a few dips in price. The stock never dipped below Rs.138 in the last two weeks. The stock closed for the month at about Rs.146.
- A final dividend of 75% was announced on 4 July, 2016. After this, the stock rose in price for the rest of the month with a slight dip in the end. The peak price for the month was about Rs.173. The stock closed for the month at about Rs.167. In August 2016, the stock opened at about Rs.168. The stock continued on a steady climb for the month, with a peak of about Rs.178. The stock closed for the month at about Rs.175. In September, the stock opened at about Rs.177. The stock briefly rose to over Rs.180 with a peak of about Rs.186 but dipped again. The lowest price in the last week of September was about Rs.167 but the stock gained a position over Rs.170 almost immediately after. The stock closed for the month at about Rs.172.
- The stock opened at about Rs.176 in October 2016. The peak for October was about Rs.181. The stock mostly declined in price for the rest of the month. The closing price for the month was about Rs.165. The first week of November saw a dip in prices, with a low of about Rs.159 but the stock gained in price immediately after. The stock touched a high of about Rs.175 in the second week of November. After that, for most of the rest of the month, the stock was below Rs.170 but closed the month at about Rs.172. In December 2016, the stock opened at about Rs.167. For almost three weeks in December, the stock remained at over Rs.160 and finally dipping below that mark on 19 December, 2016. This was followed by a further decline in prices till about Christmas. The lowest price for the month was about Rs.153. After this, the stock gained in price to close for the month at about Rs.162.
- In January 2017, the stock opened at about Rs.163. A stock split was announced in early January 2017. The stock rose sharply from Rs.163 to about Rs.175 in a day, within the first week of January 2017. The stock rose in price for the rest of the month with a brief dip. The stock closed for the month at about Rs.198. The stock opened at about Rs.197 in February 2017. The stock largely remained above Rs.190 till about 10 February, 2017. By 13 February, 2017, the stock had dipped below Rs.190. This trend continued for the rest of the month and the stock did not rise above Rs.190 in price. In March 2017, the stock opened at about Rs.189. By the end of the second week, the stock had dipped to about Rs.176. The stock rose again after that to touch a high of about Rs.194. The stock closed for the month at about Rs.188.
- The average opening price in April 2017 was about Rs.188. This was followed by a solid increase to a peak price of about Rs.203. The second week of April saw a decline in prices. The last week of April again saw an increase in prices and the stock closed for the month at an average price of Rs.199. This was the average opening price for the month of May 2017. While the first week of May saw a decline in prices, the second week of May saw a spike in prices. By the third week, the stock had touched an average high of Rs.206. This was followed by an instantaneous drop to about Rs.191. For the rest of the month, the stock remained above Rs.190 but below Rs.200. In June 2017, the stock opened at an average price of Rs.195. The second week of June saw a brief spike to over Rs.200 but the stock dipped again below that mark for almost the rest of the month. The stock remained at over Rs.200 for the last two days of the month, with a closing price of about Rs.203 for the month. A final 10% dividend was announced in June.
- The month of July 2017 saw the stock open at about Rs.205. The stock then began a gentle climb in prices for the rest of the month with a closing price of about Rs.221. The stock began August 2017 with a price of about Rs.223. The month of August also saw the price climb for the most part, closing the month at about Rs.254. In September 2017, the stock opened at about Rs.256. The stock achieved a high of about Rs.269 in this month. In the last couple of week of September 2017, the stock dipped to close for the month at about Rs.248.
- The stock opened at about Rs.249 for the month of October 2017. The stock continued on a growth trend for the month with all the prices for the rest of the month remaining above the opening price. The stock closed for October 2017 at about Rs.258. The stock opened at about Rs.264 for the month of November 2017. Till about the second week of November, the stock remained above a price of Rs.260. While the stock gained again, it reduced in price later, to close for the month at about Rs.254. In December, the opening price was about Rs.252. While there was a dip in prices to about Rs.242 in that month, the stock gained later, to a high of about Rs.271. The stock closed for the month at about Rs.269.
Should one invest in JSW Steel?
- JSW Steel has a plant located in the high-grade iron ore belt in the Karnataka Andhra Pradesh region.
- In Salem, the company acquired SISCOL which was making losses. The company expanded capacity of the plant from 0.3 Mt to 1 Mt and managed a quick turnaround of the plant.The company has a service centre in the United Kingdom.
- JSW also acquired Welspun Maxsteel Limited and Ispat Industries.
- JSW Steel has formed a joint venture in order to install a steel plant in Georgia.
- The company has ties with Japanese companies to manufacture automotive steel of a high grade.
- In addition to all these, the company has mining rights and fields in the USA, Mozambique, and the Republic of Chile.
- JSW Steel is India’s largest exporter of steel.
- The company has shown a solid increase in revenue and profits over the past year.
- While a number of reasons can be mentioned as to why one should invest in JSW Steel’s stocks, it would better to do personal research based on financial commitments and risk appetites before investing.
JSW Steel is India’s largest exporter of steel. It has six plants in India, with four locations in Maharashtra and one each in Karnataka and Tamil Nadu. The company is aiming to scale up its existing plants while adding new ones in order to achieve a capacity of about 40 million tons per annum, up from the current capacity of about 18 million tons per annum. The company has a presence in over 100 countries. The company has partnered with companies like JFE Steel, Marubeni Itochu Steel, Praxair, and Severfield Rowen Plc.
The JSW Group began operations in the steel sector with a single steel plant in 1982. This plant was located near Mumbai. The company embarked on a period of expansion after this. The expansion began with the acquisition of Piramal Steel Limited that operated in Maharashtra. The group renamed the company Jindal Iron and Steel Co (JISCO). Jindal Vijayanagar Steel Limited (JVSL) operated in the Karnataka Andhra Pradesh belt. In 2005, JISCO and JVSL merged to form JSW Steel Limited. Now, JSW Steel is the one of the largest producers of steel in India with plants located in six places around the country.
Mr. Seshagiri Rao M.V.S. is the Joint Managing Director and Group CFO of JSW Steel. He is responsible for the overall day-to-day running of the company. He is also involved in formulation of strategy. Dr. Vinod Nowal is the Deputy Managing Director of JSW Steel Limited. Previously, he was designated as Director and Chief Executive Officer. Mr. Jayant Acharya is the Director (Commercial and Marketing) for the company.
JSW Steel’s shares are traded on the BSE and the NSE.
BSE: 500228; NSE: JSWSTEELEQ; ISIN code: INE019A01038; Sector: Iron and steel; Industry: Steel
JSW Steel also forms a part of indices like, the BSE-100, BSE-200, and S&P CNX 500.
Bandra Kurla Complex, Near MMRDA Grounds, Bandra East, Mumbai 400 051
Ph: +91 22 4286 1000
Fax: +91 22 4286 3000
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