Jindal Steel and Power
Estimate change
TP change
Rating change
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23 July 2020
1QFY21 Results Update | Sector: Metals
CMP: INR172
On the path to deleveraging
Strong show amid challenging times
TP: INR226 (+32%)
Buy
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
12M Avg Val (INR M)
Financials & Valuations (INR b)
Y/E March
Sales
EBITDA
Adj. PAT
Adj. EPS (INR)
EPS Gr(%)
BV/Sh. (INR)
RoE (%)
RoCE (%)
Payout (%)
Valuations
P/E (x)
P/BV
EV/EBITDA (x)
Div. Yield (%)
2020
370.0
78.5
-3.7
-3.6
-210
315
-1.1
4.8
0.0
-47.7
0.5
7.1
0.0
2021E
374.4
94.2
7.9
7.7
-315
324
2.4
7.0
0.0
22.2
0.5
5.4
0.0
JSP IN
1,020
175.1 / 2.4
202 / 62
10/3/17
3046
Jindal Steel and Power (JSP)’s 1QFY21 result highlights the benefit of cost
reduction in its steel operations. 1QFY21 consolidated adj. EBITDA was up
2% QoQ to INR22.6b (est.: INR18.9b).
We raise JSP’s FY21/FY22 EBITDA estimates by 6%/5% to factor cost
reduction demonstrated by the company. We expect JSP to reduce its net
debt by INR83b (INR81/sh) to INR296b over FY20–22E. The Oman
divestment would reduce debt by an additional ~INR60b. Reiterate
Buy.
Consolidated:
JSP’s 1QFY21 consolidated adj. EBITDA (adj. of insurance claim
of INR1.2b) of INR22.6b (est.: INR18.9b) was up 2% QoQ (4% YoY), led by
higher volumes and cost reduction in standalone operations. The beat on
estimates was led by lower-than-expected costs in standalone operations.
Adj. PAT stood at INR1.0b (v/s est. loss of INR1.1b).
Higher volumes and cost reduction boost EBITDA
2022E
418.1
95.7
15.2
14.9
93
339
4.5
7.5
0.0
11.5
0.5
4.9
0.0
Shareholding pattern (%)
As On
Promoter
DII
FII
Others
Jun-20 Mar-20 Jun-19
60.5
60.5
60.5
14.0
12.4
9.2
12.0
13.4
15.1
13.5
13.8
15.1
Standalone: Cost reduction and higher volumes drive 9% QoQ EBITDA growth
Revenue / adj. EBITDA / adj. PAT came in at INR61.6b/INR17.1b/INR4.1b,
+4%/+9%/+47% QoQ and +2%/+20%/+158% v/s our est. The company
received an insurance claim of INR1.2b during the quarter, which we have
considered as an exceptional gain.
Steel sales (excl. pig iron) grew 4% YoY / 11% QoQ to 1.48mt, driven by
exports (58% of total volumes), as domestic sales declined ~40% YoY.
Steel NSR declined ~INR4,600/t QoQ due to higher exports and lower value-
added sales. However, decline in derived blended realization was lower at
INR3,020/t (7%) QoQ to INR41,569/t (our est.: INR40,705/t) due to higher
sales of traded goods (~+INR1,100 QoQ).
Unitary cost declined 9% QoQ to INR30,044/t (-9% QoQ) (est.: INR31,129/t),
largely due to lower cost of iron ore and thermal coal.
With lower cost nearly offsetting lower realization, EBITDA/t declined only
2% QoQ to INR11,525/t (est.: INR9,576/t).
Adj. PAT increased 47% QoQ to INR4.1b (est.: INR1.6b).
JPL: Lower coal cost drives EBITDA growth, but volumes weaken further
FII Includes depository receipts
EBITDA increased 11% QoQ to INR3.7b (est.: INR2.9b) on lower coal cost,
implying EBITDA/unit of INR1.9 (+23% QoQ).
Gross volumes, however, declined to 2,179 MUs (-10% QoQ; -27% YoY),
implying only 29% PLF.
EBITDA declined 58% QoQ to INR1.9b (est.: INR2.3b) due to lower spreads;
EBITDA/t stood at USD51/t v/s USD120/t QoQ.
Sales volumes declined 6% QoQ to 500kt (+22% YoY).
Consolidated net debt
declined by INR13.0b QoQ to INR346b at 1QFY21-
end.
Oman: Lower spreads impact EBITDA
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.
Amit Murarka – Research Analyst
(Amit.Murarka@MotilalOswal.com)
Aniket Mittal – Research Analyst
(Aniket.Mittal@MotilalOswal.com)
 Motilal Oswal Financial Services
Jindal Steel and Power
Management confident on volume growth, deleveraging in FY21
The company guided for sales volumes of 1.8mt in 2QFY21 and expects exports
of 0.6mt. It guided for sales of 3.9mt in 2HFY21, thereby guiding for sales (incl.
pig iron) of ~7.4mt in FY21.
With lower exports and higher value-added product sales, the company expects
Steel NSR to improve in 2QFY21.
The company expects to repay debt of INR55b in FY21 through cashflow
generation. The Oman divestment deal, if approved, would lead to an additional
debt reduction of another INR60b. The company has scheduled the repayment
of INR50b over the balance 9MFY21.
Deleveraging to continue, driven by strong FCF generation
With JSP booking significant exports in 1HFY21 and an expected improvement in
domestic demand in 2HFY21, we expect the company to achieve ~10% volume
growth in FY21. We expect JSP to achieve ~10% EBITDA CAGR over FY20–22E to
INR95.6b, driven by an expected 8% volume CAGR.
We expect JSP to reduce its net debt by INR83b (INR81/share) over FY20–22E to
INR296b (incl. acceptances) through strong FCF generation, led by higher
EBITDA and lower capex. We expect JSP to refinance its overseas debt
maturities (~USD800m). This would elongate the debt repayment schedule,
thereby reducing the strain on standalone cash flows.
The Oman divestment deal, if approved, with equity consideration of ~USD50m
(net of inter-company loans of USD200m), would lead to an additional net debt
reduction of ~INR60b (INR59/sh). We have not factored the deal in our
estimates. The divestment of the Oman business would lead to improved focus
on domestic operations.
Reiterate
Buy,
with an SOTP-based TP of INR226, based on 5.0x FY22E EBITDA
for the Steel business and DCF valuation for the Power business. At CMP, the
stock trades attractively at 4.5x FY22E EV/EBITDA for the Steel business.
FY21
2QE
3QE
92,326 96,003
3.3
3.2
23,620 23,863
43.9
31.1
9,981 9,921
9,769 9,720
0
0
3,871 4,222
0
0
3,871 4,222
1,084 1,182
2,787 3,040
-30
-30
2,817 3,070
-193.7 -236.9
13,640 13,942
FY20
FY21E
vs Est
1QE
(%)
85,234
7
-14.3
18,881
20
-13.1
10,078
0
10,476
-6
0
-1,673
NA
0
-1,673
NA
-497
-1,176
NA
-30
-1,146
NA
-1310.9
8,803
43
Quarterly Performance (Consolidated) - (INR m)
Y/E March
FY20
1Q
2Q
3Q
Net Sales
99,456 89,395 92,998
Change (YoY %)
2.9
-10.4
-2.8
EBITDA
21,731 16,415 18,195
Change (YoY %)
-4.5
-25.6
-12.4
Interest
11,090 10,301 10,024
Depreciation
10,536 10,390 10,179
Other Income
8
8
0
PBT (before EO item)
113 -4,266 -2,008
Extra-ordinary Income
0
0
0
PBT (after EO item)
113 -4,266 -2,008
Total Tax
987
-273
178
Reported PAT
-874 -3,993 -2,186
MI - Loss/(Profit)
-968
-988
57
Adjusted PAT
95 -3,005 -2,243
Change (YoY %)
-94.8 -440.7 767.6
Cash profit (pre tax and MI)
10,649 6,123 8,171
E: MOFSL Estimates
4Q
88,107
-13.3
22,198
20.3
10,078
10,500
246
1,865
1,838
3,704
647
3,056
-1,006
2,224
198.0
12,365
1Q
91,585
-7.9
22,638
4.2
10,041
9,818
31
2,809
1,203
4,012
1,336
2,676
845
1,029
987.7
12,628
4QE
99,698 3,69,955 3,74,384
13.2
-6.0
1.2
24,605
78,539
94,248
10.8
-6.6
20.0
9,876
41,493
39,819
12,282
41,604
41,589
0
262
31
2,447
-4,296
12,871
0
1,838
1,203
2,447
-2,458
14,074
1,013
1,539
4,615
1,434
-3,997
9,459
-30
-2,150
755
1,464
-3,684
7,902
-34.2
-215.9
-314.5
14,729
37,308
54,460
23 July 2020
2
 Motilal Oswal Financial Services
Jindal Steel and Power
Management call highlights
Indian Steel operations: NSR to improve in 2QFY21; volume growth to continue
During the quarter, the company exported 900kt of steel (~58% of volumes). It
exported steel to China, Europe, Southeast Asia, and the Middle East.
Steel NSR declined by INR4,600/t QoQ, primarily due to lower value-added
products. However, blended realization declined by just INR3,020/t QoQ on
higher sales of traded goods, which had a positive impact of ~INR1,100/t.
The company informed that it had lowered steel-making cost from INR23,500/t
to INR20,500/t sequentially, i.e., INR3,000/t due to lower iron ore, coal, and
consumables costs. It expects this cost reduction to sustain in 2QFY21.
During the quarter, the company changed the accounting of PCI Coal
consumption from the ‘Other Expenses’ head to the ‘Raw Materials’ head. This
has lowered other expenses by INR1.0b and increased raw materials cost by the
same amount.
The company guided for sales volumes of 1.8mt in 2QFY21 and expects
exports of 0.6mt. It also guided for sales of 3.9mt in 2HFY21, thereby guiding
for sales of ~7.4mt in FY21.
With lower exports and higher value-added product sales, the company
expects Steel NSR to improve in 2QFY21.
The company guided for the benefit of lower coking coal costs to the extent of
USD25–30/t of coal to kick in over 2QFY21.
JSPL is currently utilizing free-of-cost Sarda iron ore inventory at the rate of up
to 1.8mt/qtr. JSPL is also purchasing iron ore from SMPL, NMDC, OMC, and
other parties to achieve the required blend.
Capex in 1QFY21 stood at INR1.1b, with FY21 guided at INR6.0–8.0b.
Jindal Power Ltd
Lower coal cost and higher realization offset the impact of lower volumes in
1QFY21.
Besides supplying for 800MW of PPAs (out of 3400MW capacity), JPL sold power
in the merchant market during peak hours to earn higher tariffs. With improving
power demand, it expects volumes to improve from 2QFY21.
JPL received an installment of INR1.6b from TANGEDCO toward its receivables. It
further expects to receive INR1.7b in July and a substantial reduction in the
receivables amount over the next six months.
JPL expects to sign two three-year PPAs of 420MW under the PFC Pilot Scheme-
II; power supply should commence from 3QFY21.
JPL has opted for interest and principal repayment and is utilizing cashflows to
procure coal inventory at lower rates.
JPL also plans to bid for the coal block in the upcoming coal auctions.
Debt position
Consolidated net debt declined by INR13.0b QoQ to INR346.2b (USD4.6b).
Breakup of gross debt at each entity: Standalone – INR148b, JPL – INR72b,
JSPML – USD710m, WCL – USD330m, and Oman – INR55b
23 July 2020
3
 Motilal Oswal Financial Services
Jindal Steel and Power
The company
expects to repay debt of INR55b in FY21 (with INR50b over the
rest of 9MFY21) through internal accruals. The Oman divestment deal, if
approved, would lead to additional debt reduction of INR60b.
JSP expects to refinance its overseas debt in Australia and Mauritius, which
mostly falls due in FY21.
Oman divestment consideration: Although the equity consideration to be
received by JSPML for the sale of the Oman business stands at USD251m
(INR19b), Oman has outstanding loans of ~USD200m to JSPML, which would be
fulfilled against the equity consideration. The cash receipt by JSPML for the sale
of the Oman business would thus be only ~USD50m. The company would seek
all the necessary approvals for the transaction by July-end.
INR m
4Q
59,303
44,589
-19.9
15,622
11,746
6,225
5,676
0
3,722
0
3,722
904
24.3
2,818
2,818
1Q
61,605
41,569
-13.0
17,080
11,525
6,040
5,616
0
5,425
1,203
6,627
1,580
23.8
5,047
4,132
FY21E
2QE
3QE
67,052 67,723
41,509 42,347
2.0
2.0
18,739 18,464
11,600 11,546
5,979
5,920
5,588
5,560
0
0
7,172
6,985
0
0
7,172
6,985
2,008
1,956
28.0
28.0
5,164
5,029
5,164
5,029
FY20
FY21E
4QE
69,355 2,62,283 2,65,736
43,255 46,015
17.0
-5.4
1.3
18,902 57,774 73,186
11,789 10,136 11,617
6,862 26,106 24,801
5,765 22,871 22,528
0
0
0
6,275
8,797 25,857
0
1,203
6,275
8,797 27,060
1,696
2,620
7,240
27.0
29.8
26.8
4,579
6,177 19,820
4,579
6,177 18,904
vs Est
1QE
(%)
60,326
2
40,705
2
-14.9
14,191
20
9,576
20
6,225
-3
5,676
-1
0
2,291
137
0
2,291
189
692
30.2
1,599
216
1,599
158
Source: MOFSL
Quarterly performance (standalone)
Y/E March
Net Sales
NSR (INR/t)
Change (YoY %)
EBITDA
INR/t
Interest
Depreciation
Other Income
PBT (before EO item)
Extra-ordinary Income
PBT (after EO item)
Total Tax
% Tax
Reported PAT
Adjusted PAT
1Q
70,848
49,544
5.2
16,080
11,245
6,970
5,671
0
3,440
0
3,440
1,201
34.9
2,239
2,239
FY20
2Q
3Q
65,729 66,403
49,420 41,244
-4.0
-1.3
12,551 13,521
9,437 8,398
6,569 6,343
5,823 5,702
0
0
159 1,476
0
0
159 1,476
8
507
4.7
34.3
151
969
151
969
Operational performance (standalone)
Sales volumes
Change (YoY %)
Change (QoQ %)
Realization
Change (YoY %)
Change (QoQ %)
EBITDA(INR/Ton)
Change (YoY %)
Change (QoQ %)
1Q
1,430
20.2
-1.4
49,544
-6.0
3.1
11,245
-18.7
13.2
FY20
2Q
1,330
3.9
-7.0
49,420
0.2
-0.2
9,437
-16.8
-16.1
3Q
1,610
34.2
21.1
41,244
-21.8
-16.5
8,398
-31.9
-11.0
Steel sales
4Q
1,330
-8.3
-17.4
44,589
-7.3
8.1
11,746
18.3
39.9
1Q
1,482
3.6
11.4
41,569
-16.1
-6.8
11,525
2.5
-1.9
FY21
2QE
1,615
21.5
9.0
41,509
-16.0
-0.1
11,600
22.9
0.7
Steel production
3QE
1,599
-0.7
-1.0
42,347
2.7
2.0
11,546
37.5
-0.5
4QE
1,603
20.6
0.3
43,255
-3.0
2.1
11,789
0.4
2.1
Sales and production rise
despite COVID-19 impact
due to higher exports.
Exhibit 1: Standalone steel volumes and production (kt)
Source: MOFSL
23 July 2020
4
 Motilal Oswal Financial Services
Jindal Steel and Power
EBITDA/t declines
marginally as lower
realization due to an
adverse mix is offset by
lower cost.
Exhibit 2: Spreads and EBITDA/t
EBITDA per ton (INR 000)
26
23
25
26
28
26
27
30
31
28
30
Spreads (INR 000/t)
27
27
26
30
22
25
8
7
9
10
9
9
10
13
14
11
12
10
11
9
8
12
12
Source: MOFSL
Exhibit 3: Quarterly performance (subsidiaries and associates)
Y/E March
1Q
Sales volume (kt)
Oman Steel
Net Sales
Change (YoY %)
EBITDA
Change (YoY %)
As % of Net Sales
Interest
Depreciation
Other Income
PBT (before EO item)
Extra-ordinary Income
PBT (after EO item)
Total Tax
% Tax
Reported PAT
FY20
2Q
3Q
4Q
1Q
FY21
2QE
3QE
FY20
4QE
FY21E
INR m
vs Est
1QE
(%)
0
20
18
4
-12
-34
-34
-15
410
370
570
530
500
450
500
550
3,880
2,000
500
28,608 23,665 26,595 28,804 29,980 25,273 28,280 30,343 1,07,672 1,13,876 24,908
-2.4
-24.5
-6.2
4.5
4.8
6.8
6.3
5.3
-7.6
5.8
-12.9
5,651 3,864 4,674 6,576 5,557 4,881 5,399 5,703
20,766
21,540 4,690
-10.5
-48.8
-21.7
62.5
-1.7
26.3
15.5
-13.3
-13.1
3.7
-17.0
19.8
16.3
17.6
22.8
18.5
19.3
19.1
18.8
19.3
18.9
18.8
4,121 3,732
3,682
3,853 4,001 4,001 4,001 4,001
15,387
16,006 3,853
4,865 4,567
4,477
4,824 4,202 4,181 4,160 4,140
18,733
16,684 4,800
8
8
0
246
31
0
0
0
262
31
0
-3,327 -4,425 -3,484 -1,856 -2,615 -3,302 -2,763 -2,438 -13,092 -11,118 -3,963
0
0
0 1,838
0
0
0
0
1,838
0
0
-3,327 -4,425 -3,484
-18 -2,615 -3,302 -2,763 -2,438 -11,254 -11,118 -3,963
-214
-281
-329
-257
-244
-924
-774
-683
-1,081
-2,624 -1,189
6.4
6.3
9.4 1434.1
9.3
28.0
28.0
28.0
9.6
23.6
30.0
-3,112 -4,145 -3,155
239 -2,372 -2,377 -1,989 -1,755 -10,173
-8,494 -2,774
Valuation and view
With JSP able to book significant exports in 1HFY21 and an expected
improvement in domestic demand in 2HFY21, we expect the company to
achieve ~10% volume growth in FY21. We expect JSP to achieve a ~10% EBITDA
CAGR over FY20–22E to INR95.6b, driven by an expected 8% CAGR in volumes.
We expect JSP to reduce its net debt by INR83b (INR81/share) over FY20–22E to
INR296b (incl. acceptances) through strong FCF generation, led by higher
EBITDA and lower capex. We expect JSP to refinance its overseas debt
maturities (~USD800m). This would elongate the debt repayment schedule,
thereby reducing the strain on standalone cash flows.
The Oman divestment deal, if approved, with an equity consideration of
~USD50m (net of inter-company loans of US$200m) would lead to an additional
net debt reduction of ~INR60b (INR59/sh). We have not factored the deal in our
estimates. The divestment of the Oman business would lead to an improved
focus on domestic operations.
Reiterate
Buy,
with an SOTP-based TP of INR226, based on 5.0x FY22E EBITDA
for the Steel business and DCF valuation for the Power business. At CMP, the
stock trades attractively at 4.5x FY22E EV/EBITDA for the Steel business.
23 July 2020
5
 Motilal Oswal Financial Services
Jindal Steel and Power
Exhibit 4: Target price calculation
Y/E March
Steel Business
A. EBITDA
B. Target EV/EBITDA(x)
C. EV (AxB)
Jindal Power (JPL)
D. PV of JPL's FCFF
Consolidated
EBITDA
E. Enterprise Value (C+D)
F. Net Debt
Equity Value (E-F)
Target price (INR/share)
FY16
FY17
FY18
FY19
72,496
FY20
66,049
FY21E
80,075
FY22E
81,637
5.0
4,08,184
1,18,645
34,410
4,63,928
46,613
4,61,427
64,691
4,38,319
84,056
4,10,943
78,539
3,79,230
94,248
3,36,998
95,699
5,26,829
2,96,492
2,30,337
226
Source: MOFSL, Company
23 July 2020
6
 Motilal Oswal Financial Services
Jindal Steel and Power
Financials and valuations
Income Statement (Consolidated)
Y/E March
Net sales
Change (%)
Total Expenses
EBITDA
% of Net Sales
Depn. & Amortization
EBIT
Net Interest
Other income
PBT before EO
EO income
PBT after EO
Tax
Rate (%)
Reported PAT
Minority interests
Preference dividend
Share of Associates
Adjusted PAT
Change (%)
Balance Sheet (Consolidated)
Y/E March
Share Capital
Reserves
Net Worth
Minority Interest
Total Loans
Deferred Tax Liability
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Goodwill & Revaluation
Investments
Curr. Assets
Inventory
Account Receivables
Cash and Bank Balance
Loans & advances and others
Curr. Liability & Prov.
Account Payables
Provisions & Others
Net Current Assets
Appl. of Funds
2015
2,01,592
4.5
1,46,994
54,598
27.1
27,328
27,270
25,837
2,256
3,689
-19,116
-15,428
-882
5.7
-14,546
-1,738
26
6,335
-66.8
2016
1,83,709
-8.9
1,49,299
34,410
18.7
28,194
6,216
32,808
2,200
-24,391
-2,358
-26,750
-6,763
25.3
-19,987
-980
0
-14
-16,662
-363.0
2017
2,10,194
14.4
1,63,581
46,613
22.2
39,490
7,122
34,240
411
-26,706
-3,723
-30,429
-5,027
16.5
-25,402
-2,524
0
27
-19,128
14.8
2018
2,76,244
31.4
2,11,553
64,691
23.4
38,830
25,861
38,657
29
-12,767
-5,874
-18,641
-2,398
12.9
-16,243
-2,064
0
87
-8,218
-57.0
2019
3,93,721
42.5
3,09,666
84,056
21.3
41,938
42,118
42,642
157
-367
-27,650
-28,017
-3,902
13.9
-24,115
-7,644
0
0
3,178
-138.7
2020
3,69,955
-6.0
2,91,416
78,539
21.2
41,604
36,935
41,493
262
-4,296
1,838
-2,458
1,539
-62.6
-3,996
-2,150
0
0
-3,683
NA
2021E
3,74,384
1.2
2,80,136
94,248
25.2
41,589
52,660
39,819
12,840
1,203
14,043
4,616
32.9
9,427
-40
0
0
7,902
NA
(INR m)
2022E
4,18,070
11.7
3,22,370
95,699
22.9
40,443
55,256
35,385
19,871
0
19,871
4,681
23.6
15,191
-22
0
0
15,213
92.5
(INR m)
2022E
1,020
3,45,032
3,46,052
-7,827
3,30,749
54,943
7,23,917
9,70,772
3,33,576
6,37,196
13,745
6,098
1,430
2,08,724
72,160
40,089
34,256
62,219
1,43,276
40,089
1,03,187
65,448
7,23,917
2015
915
2,09,506
2,10,421
8,573
4,55,007
20,185
6,94,185
6,12,235
1,51,286
4,60,949
90,728
5,485
17,852
1,80,353
48,487
16,907
11,391
1,03,568
61,181
38,391
22,790
1,19,172
6,94,185
2016
915
1,80,556
1,81,471
8,003
4,70,132
13,477
6,73,082
6,27,116
1,78,233
4,48,883
1,18,266
5,485
3,577
1,59,182
32,360
14,292
6,204
1,06,326
62,310
42,186
20,124
96,872
6,73,082
2017
915
2,99,590
3,00,505
6,467
4,66,571
53,586
8,27,129
7,83,127
1,29,476
6,53,651
97,162
5,670
3,677
1,45,820
35,993
17,166
5,144
87,517
78,850
22,221
56,629
66,970
8,27,129
2018
968
3,02,878
3,03,846
4,403
4,43,104
50,284
8,01,638
8,46,580
1,68,002
6,78,578
49,775
5,922
1,458
1,56,572
49,596
18,261
4,786
83,930
90,667
28,434
62,233
65,905
8,01,638
2019
968
3,23,309
3,24,276
-3,011
4,15,227
53,643
7,90,135
9,00,003
2,09,940
6,90,063
40,272
6,164
1,452
1,57,902
65,095
30,292
4,284
58,231
1,05,718
32,087
73,631
52,184
7,90,135
2020
1,020
3,20,351
3,21,371
-7,764
3,88,749
56,225
7,58,580
9,50,772
2,51,544
6,99,228
19,745
6,098
1,430
1,70,917
63,687
35,493
9,519
62,219
1,38,838
35,651
1,03,187
32,079
7,58,581
2021E
1,020
3,29,819
3,30,839
-7,804
3,70,749
55,531
7,49,314
9,60,772
2,93,133
6,67,639
16,745
6,098
1,430
1,96,488
64,620
35,900
33,750
62,219
1,39,087
35,900
1,03,187
57,401
7,49,314
23 July 2020
7
 Motilal Oswal Financial Services
Jindal Steel and Power
Financials and Valuations
Ratios (Consolidated)
Y/E March
Basic (INR)
EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
Return Ratios (%)
EBITDA Margins (%)
Net Profit Margins (%)
RoE
RoCE (pre-tax)
RoIC (pre-tax)
Working Capital Ratios
Fixed Asset Turnover (x)
Asset Turnover (x)
Inventory (Days)
Debtor (Days)
Payable (Days)
Leverage Ratio (x)
Current Ratio
Interest Cover Ratio
Debt/Equity
Cash Flow Statement (Consolidated)
Y/E March
EBITDA
Non cash exp. (income)
(Inc)/Dec in Wkg. Cap.
Tax Paid
others
CF from Op. Activity
(Inc)/Dec in FA + CWIP
(Pur)/Sale of Investments
Acquisition in subsidiaries
Loans and advances
Int. & Dividend Income
Other investing activities
CF from Inv. Activity
Equity raised/(repaid)
Debt raised/(repaid)
Dividend (incl. tax)
Interest paid
Other financing
CF from Fin. Activity
(Inc)/Dec in Cash
Add: opening Balance
Closing Balance
2015
6.9
14.0
230.0
1.6
27.0
2016
(18.2)
9.0
198.4
0.0
0.0
2017
(20.9)
15.4
328.4
0.0
0.0
2018
(8.5)
23.3
313.9
0.0
0.0
2019
3.3
18.4
335.0
0.0
0.0
52.4
9.3
0.5
1.5
6.9
0.0
27.1
3.1
2.9
4.5
5.5
0.4
0.3
88
31
70
2.9
1.1
2.1
2015
54,598
-21,600
-18,154
-3,393
11,451
-50,964
-13,430
367
0
1,003
-2,341
-65,365
5
90,704
-1,448
-34,381
271
55,151
1,238
10,153
11,391
18.7
(9.1)
(8.5)
1.2
1.1
0.3
0.3
64
28
84
2.6
0.2
2.6
2016
34,410
-4,581
11,762
-170
41,422
-39,500
15,904
1,052
-1,337
2,292
1,699
-19,889
0
9,230
-8
-35,941
0
-26,719
-5,187
11,391
6,204
22.2
(9.1)
(7.9)
1.0
1.1
0.3
0.3
63
30
39
1.8
0.2
1.5
2017
46,613
-1,020
7,190
450
15,840
69,072
-24,975
5,164
-934
754
1,511
-18,481
0
-10,256
0
-41,396
-51,651
-1,060
6,204
5,144
23.4
(3.0)
(2.6)
3.2
3.6
0.4
0.3
66
24
38
1.7
0.7
1.4
2018
64,691
2,853
-9,267
-553
14,101
71,825
-25,767
12,299
-2,376
1,533
-533
-14,845
13,883
-24,391
15
-46,845
-57,338
-358
5,144
4,786
21.3
0.8
1.0
5.3
5.7
0.5
0.5
60
28
30
1.5
1.0
1.3
2019
84,056
1,262
-23,983
296
22,001
83,632
-14,333
2,436
3,044
532
-533
-8,853
0
-30,260
-18
-45,699
-75,977
-1,199
4,786
3,587
2020
(3.6)
36.9
315.1
0.0
0.0
(47.7)
4.7
0.5
1.5
7.1
0.0
21.2
(1.0)
(1.1)
4.8
5.1
0.5
0.5
63
35
35
1.2
0.9
1.2
2020
78,539
1,569
-771
35
15,894
95,265
-16,646
339
-219
527
-15,999
5,129
-40,676
-18
-40,054
-75,620
3,647
4,284
7,931
2021E
7.7
50.0
324.4
0.0
0.0
22.2
3.4
0.5
1.4
5.4
0.0
25.2
2.1
2.4
7.0
7.5
0.5
0.4
63
35
35
1.4
1.3
1.0
2021
94,248
-1,091
-5,309
87,848
-7,000
0
0
-7,000
-18,000
0
-39,819
-57,819
23,029
9,519
32,548
2022E
14.9
54.5
339.3
0.0
0.0
11.5
3.2
0.5
1.1
4.9
0.0
22.9
3.6
4.5
7.5
8.1
0.6
0.4
63
35
35
1.5
1.6
0.9
(INR m)
2022
95,699
-7,540
-5,268
82,891
-7,000
0
0
-7,000
-40,000
0
-35,385
-75,385
506
33,750
34,256
23 July 2020
8
 Motilal Oswal Financial Services
Jindal Steel and Power
Explanation of Investment Rating
Investment Rating
Expected return (over 12-month)
BUY
>=15%
SELL
< - 10%
NEUTRAL
< - 10 % to 15%
UNDER REVIEW
Rating may undergo a change
NOT RATED
We have forward looking estimates for the stock but we refrain from assigning recommendation
*In case the recommendation given by the Research Analyst is inconsistent with the investment rating legend for a continuous period of 30 days, the Research Analyst shall within
following 30 days take appropriate measures to make the recommendation consistent with the investment rating legend.
Disclosures
The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).
Motilal Oswal Financial Services Ltd. (MOFSL) is a SEBI Registered Research Analyst having registration no. INH000000412. MOFSL, the Research Entity (RE) as defined in the
Regulations, is engaged in the business of providing Stock broking services, Investment Advisory Services, Depository participant services & distribution of various financial
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available on www.motilaloswal.com. MOFSL (erstwhile Motilal Oswal Securities Limited - MOSL) is registered with the Securities & Exchange Board of India (SEBI) and is a
registered Trading Member with National Stock Exchange of India Ltd. (NSE) and Bombay Stock Exchange Limited (BSE), Multi Commodity Exchange of India Limited (MCX) and
National Commodity & Derivatives Exchange Limited (NCDEX) for its stock broking activities & is Depository participant with Central Depository Services Limited (CDSL) National
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Regulatory & Development Authority of India (IRDA) as Corporate Agent for insurance products.
Details of associate entities of Motilal Oswal Financial Services Limited are
available on the website at
http://onlinereports.motilaloswal.com/Dormant/documents/List%20of%20Associate%20companies.pdf
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buy or sell the securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other
compensation or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have
any other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the
specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even
though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report
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https://galaxy.motilaloswal.com/ResearchAnalyst/PublishViewLitigation.aspx
A graph of daily closing prices of securities is available at
www.nseindia.com, www.bseindia.com.
Research Analyst views on Subject Company may vary based on Fundamental
research and Technical Research. Proprietary trading desk of MOFSL or its associates maintains arm’s length distance with Research Team as all the activities are segregated
from MOFSL research activity and therefore it can have an independent view with regards to Subject Company for which Research Team have expressed their views.
Regional Disclosures (outside India)
This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability
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For Hong Kong:
This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong
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research report in Hong Kong. This report is intended for distribution only to “Professional Investors” as defined in Part I of Schedule 1 to SFO. Any investment or investment activity
to which this document relates is only available to professional investor and will be engaged only with professional investors.” Nothing here is an offer or solicitation of these
securities, products and services in any jurisdiction where their offer or sale is not qualified or exempt from registration. The Indian Analyst(s) who compile this report is/are not
located in Hong Kong & are not conducting Research Analysis in Hong Kong.
For U.S.
Motilal Oswal Financial Services Limited (MOFSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under
applicable state laws in the United States. In addition MOFSL is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers
Act" and together with the 1934 Act, the "Acts), and under applicable state laws in the United States. Accordingly, in the absence of specific exemption under the Acts, any
brokerage and investment services provided by MOFSL , including the products and services described herein are not available to or intended for U.S. persons. This report is
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The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S.
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For Singapore
In Singapore, this report is being distributed by Motilal Oswal Capital Markets Singapore Pte Ltd (“MOCMSPL”) (Co.Reg. NO. 201129401Z) which is a holder of a capital markets
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Specific Disclosures
1 MOFSL, Research Analyst and/or his relatives does not have financial interest in the subject company, as they do not have equity holdings in the subject company.
2 MOFSL, Research Analyst and/or his relatives do not have actual/beneficial ownership of 1% or more securities in the subject company
3 MOFSL, Research Analyst and/or his relatives have not received compensation/other benefits from the subject company in the past 12 months
4 MOFSL, Research Analyst and/or his relatives do not have material conflict of interest in the subject company at the time of publication of research report
5 Research Analyst has not served as director/officer/employee in the subject company
6 MOFSL has not acted as a manager or co-manager of public offering of securities of the subject company in past 12 months
7 MOFSL has not received compensation for investment banking/ merchant banking/brokerage services from the subject company in the past 12 months
8 MOFSL has not received compensation for other than investment banking/merchant banking/brokerage services from the subject company in the past 12 months
9 MOFSL has not received any compensation or other benefits from third party in connection with the research report
10 MOFSL has not engaged in market making activity for the subject company
23 July 2020
9
 Motilal Oswal Financial Services
Jindal Steel and Power
********************************************************************************************************************************
The associates of MOFSL may have:
- financial interest in the subject company
- actual/beneficial ownership of 1% or more securities in the subject company
- received compensation/other benefits from the subject company in the past 12 months
- other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the
specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even
though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report.
- acted as a manager or co-manager of public offering of securities of the subject company in past 12 months
- be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the
company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies)
- received compensation from the subject company in the past 12 months for investment banking / merchant banking / brokerage services or from other than said services.
The associates of MOFSL has not received any compensation or other benefits from third party in connection with the research report
Above disclosures include beneficial holdings lying in demat account of MOFSL which are opened for proprietary investments only. While calculating beneficial holdings, It does not
consider demat accounts which are opened in name of MOFSL for other purposes (i.e holding client securities, collaterals, error trades etc.). MOFSL also earns DP income from
clients which are not considered in above disclosures.
Analyst Certification
The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the
research analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report.
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Website
www.motilaloswal.com.CIN
no.: L67190MH2005PLC153397.Correspondence Office Address: Palm Spring Centre, 2nd Floor, Palm Court Complex, New Link Road,
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Registration Nos.: Motilal Oswal Financial Services Limited (MOFSL)*: INZ000158836(BSE/NSE/MCX/NCDEX); CDSL and NSDL: IN-DP-16-2015; Research Analyst:
INH000000412. AMFI: ARN - 146822; Investment Adviser: INA000007100; Insurance Corporate Agent: CA0579;PMS:INP000006712. Motilal Oswal Asset Management Company
Ltd. (MOAMC): PMS (Registration No.: INP000000670); PMS and Mutual Funds are offered through MOAMC which is group company of MOFSL. Motilal Oswal Wealth
Management Ltd. (MOWML): PMS (Registration No.: INP000004409) is offered through MOWML, which is a group company of MOFSL. Motilal Oswal Financial Services Limited is
a distributor of Mutual Funds, PMS, Fixed Deposit, Bond, NCDs,Insurance Products and IPOs.Real Estate is offered through Motilal Oswal Real Estate Investment Advisors II Pvt.
Ltd. which is a group company of MOFSL. Private Equity is offered through Motilal Oswal Private Equity Investment Advisors Pvt. Ltd which is a group company of MOFSL.
Research & Advisory services is backed by proper research. Please read the Risk Disclosure Document prescribed by the Stock Exchanges carefully before investing. There is no
assurance or guarantee of the returns. Investment in securities market is subject to market risk, read all the related documents carefully before investing. Details of Compliance
Officer: Name: Neeraj Agarwal, Email ID: na@motilaloswal.com, Contact No.:022-71881085.
* MOSL has been amalgamated with Motilal Oswal Financial Services Limited (MOFSL) w.e.f August 21, 2018 pursuant to order dated July 30, 2018 issued by Hon'ble National
Company Law Tribunal, Mumbai Bench.
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