|
Consolidated
net sales (including other operating income) of JSW Steel has increased 1.73%
to Rs 42943 crore. Operating profit
margin has declined from 16.69% to 12.83%, leading to 21.80% decline in
operating profit to Rs 5,510.00 crore.
Raw material cost as a % of total sales (net of stock adjustments)
decreased from 52.43% to 51.17%.
Purchase of finished goods cost fell from 0.64% to 0.17%. Employee cost increased from 2.61% to
2.98%. Other expenses rose from 28.45%
to 32.55%. Power and Oil fuel cost rose
from 8.51% to 9.31%. Other direct
service cost rose from 6.58% to 7.86%.
Consolidated
crude steel production for the quarter stood at 6.35 million tonne, lower by 1%
YoY and 6% QoQ. Capacity utilization at the Indian operations was 87% during
the quarter due to planned maintenance shutdowns at Dolvi and BPSL.
Steel
Sales for the quarter stood at 6.12 million tonne, higher by 7% YoY and lower
by 9%QoQ. Domestic sales at 5.31 million tonne were higher by 14% YoY and by 3%
QoQ. Sales volumes of OEM & Industrial segment increased by 18% and Retail
segment grew 8% YoY. Exports fell 29% YoY and constituted 10% of sales from the
Indian operations for Q1 FY25 vs. 15% of sales in Q1 FY24.
Other
income fell 50.45% to Rs 164 crore.
PBIDT fell 23.09% to Rs 5674 crore.
Provision for interest rose 5.60% to Rs 2073 crore.
PBDT
fell 33.49% to Rs 3601 crore. Provision
for depreciation rose 16.26% to Rs 2209 crore.
Profit
before tax down 60.39% to Rs 1,392.00 crore.
Share of profit/loss was 64.71% higher at Rs -12 crore. Provision for tax was expense of Rs 513
crore, compared to Rs 1052 crore.
Effective tax rate was 37.17% compared to 30.23%.
Minority
interest decreased 75.56% to Rs 22.00 crore.
Net profit attributable to owners of the company decreased 63.86% to Rs
845.00 crore.
Promoters’
stake was 44.81% as of 30 June 2024 ,compared to 45.40% as of 30 June 2023
. Promoters pledged stake was 15.16% as
of 30 June 2024 ,compared to 15.03% as of 30 June 2023.
Full year results
analysis
Net
sales (including other operating income) of JSW Steel has increased 5.45% to Rs
175006 crore. Operating profit margin
has jumped from 11.18% to 16.13%, leading to 52.24% rise in operating profit to
Rs 28,236.00 crore. Raw material cost as
a % of total sales (net of stock adjustments) decreased from 56.03% to
52.55%. Purchase of finished goods cost
fell from 0.90% to 0.65%. Employee cost
increased from 2.32% to 2.58%. Other
expenses fell from 29.75% to 28.36%.
Power and Oil fuel cost fell from 10.35% to 8.49%. Other direct service cost rose from 4.42% to
5.62%.
Other
income fell 2.52% to Rs 1004 crore.
PBIDT rose 49.36% to Rs 29240 crore.
Provision for interest rose 17.43% to Rs 8105 crore. Loan funds rose to Rs 87,984.00 crore as of
31 March 2024 from Rs 80,853.00 crore as of 31 March 2023. Inventories rose to Rs 37,815.00 crore as of
31 March 2024 from Rs 33,135.00 crore as of 31 March 2023. Sundry debtors were higher at Rs 7,548.00
crore as of 31 March 2024 compared to Rs 7,134.00 crore as of 31 March 2023. Cash and bank balance declined from Rs
20,714.00 crore as of 31 March 2023 to Rs 12,348.00 crore as of 31 March
2024. Investments rose to Rs 7,246.00
crore as of 31 March 2024 from Rs 4,806.00 crore as of 31 March 2023 .
PBDT
rose 66.75% to Rs 21135 crore. Provision
for depreciation rose 9.34% to Rs 8172 crore.
Fixed assets increased to Rs 1,38,956.00 crore as of 31 March 2024 from
Rs 1,26,490.00 crore as of 31 March 2023.
Intangible assets increased from Rs 128.00 crore to Rs 3,181.00
crore.
Profit
before tax grew 149.24% to Rs 12,963.00 crore.
Share of profit/loss was 25.55% lower at Rs -172 crore. Extraordinary items were decreased to Rs
589.00 crore. Provision for tax was
expense of Rs 4407 crore, compared to Rs 1516 crore. Effective tax rate was 32.94% compared to
26.81%.
Net
profit attributable to owners of the company increased 112.64% to Rs 8,812.00
crore.
Equity
capital increased from Rs 301.00 crore as of 31 March 2023 to Rs 305.00 crore
as of 31 March 2024. Per share face
Value remained same at Rs 1.00.
Promoters’
stake was 44.81% as of 31 March 2024 compared to 45.40% as of 31 March
2023. Promoters pledged stake was 15.24%
as of 31 March 2024 compared to 16.35% as of 31 March 2023 .
Cash
flow from operating activities decreased to Rs 12,078.00 crore for year ended
March 2024 from Rs 23,323.00 crore for year ended March 2023. Cash flow used in acquiring fixed assets
during the year ended March 2024 stood at Rs 15,801.00 crore, compared to Rs
14,784.00 crore during the year ended March 2023.
Subsidiaries
performance:
Bhushan Power &
Steel (BPSL):
During the quarter, BPSL registered Crude Steel Production of 0.78 million
tonnes and Sales volume of 0.75 million tonnes. Revenue from Operations and
Operating EBITDA for the quarter stood at Rs 5,564 crores and 1670 crores,
respectively. The EBITDA increased by 25% QoQ. BPSL reported a Profit after Tax
of Rs 300 crores for the quarter.
JSW Steel Coated
Products (Consolidated): During the quarter, JSW Steel Coated Products,
including its subsidiary, registered a production volume (GI/GL, Tin, CRCA
& other saleable products) of 1.15 million tonnes and sales volume of 1.14
million tonnes. Revenue from Operations for the quarter stood at Rs 9,161
crores, and EBITDA was Rs 369 crores. The EBITDA is lower by 26% on QoQ basis
mainly due to lower realisations and higher input cost of zinc and aluminum,
partially off-set by lower HRC prices. The subsidiary reported a net profit of
Rs 58 crores for the quarter.
JSW Steel USA Ohio: The EAF-based steel
manufacturing facility in Ohio, USA, produced 2,53,169 net tonnes of Slabs
during the quarter. Capacity utilization was 70% during the quarter. Sales
volumes for the quarter stood at 47,398 net tonnes of HRC and 1,90,534 net
tonnes of Slabs. It reported an EBITDA loss of US$ 15.61 million for the
quarter.
US Plate & Pipe
Mill:
The Plate & Pipe Mill based in Texas, USA produced 1,06,029 net tonnes of
Plates and 8,198 net tonnes of Pipes, reporting a capacity utilization of 45%
and 6%, respectively, during the quarter. Sales volumes for the quarter stood
at 99,650 net tonnes of Plates and 9,701 net tonnes of Pipes. It reported an
EBITDA of US$ 12.99 million.
Italy Operations: The Italy based
Rolled long products manufacturing facility produced 77,057 tonnes and sold
70,006 tonnes of rolled products during the quarter. It reported an EBITDA of
Euro 7.67 million for the quarter.
Transfer of Slurry
Pipeline Project in Odisha to JSW Infrastructure Ltd
The
company has approved the transfer of slurry pipeline undertaking pertaining to
the under-construction 30 MTPA slurry pipeline in Odisha being set up by JSW
Utkal Steel Limited, a wholly owned subsidiary of the Company, by way of a
slump sale to JSW Infrastructure Limited, and to enter into a long-term take or
pay" agreement for transportation of iron ore slurry for a period of 20
years with JSW Infrastructure Limited. The total planned capex of this
undertaking was estimated at Rs 3400 crores, which will now be incurred by JSW
Infrastructure Limited.
The
slurry pipeline project would be transferred on an arm`s length basis for a
consideration of estimated at Rs 1,700 crores, which would be the aggregate of
the fair value of the cost incurred till 31 May 2024, as determined by an
independent valuer, and the cost incurred post 31 May 2024 till the actual date
of transfer. The transaction is subject to receipt of shareholders` approval,
other regulatory approvals, if any. This transaction allows efficient and
prudent capital allocation at JSW Steel, preserving capital for future growth,
and allowing management to focus on the core steel business.
Update on Projects:
The
Hot Strip Mill of the 5 MTPA project at Vijayanagar, set up by wholly owned
subsidiary, JSW Vijayanagar Metallics Ltd. (JVML), was commissioned in March
2024. Commercial production and sales from the HSM facility have commenced in
March 2024. The Sinter Plant and the Blast Furnace is expected to be
commissioned by the end of July, and the Steel Melt Shop expected to be
commissioned by end of August 2024. We expect ramp-up of the expansion project
by the end of Q3 FY25.
At
BPSL, the Phase-II expansion from 3.5 MTPA to 5 MTPA, has seen most major
equipment and facilities commissioned. The oxygen plant is scheduled for
commissioning in July, with a gradual ramp-up of operations to 4.5 MTPA
expected by Q3 FY25. The balance 0.5 MTPA capacity will be achieved through
debottlenecking by FY27.
At
JSW Steel Coated Products Limited, the colour coated line of 0.12 MTPA in Jammu
& Kashmir is expected to start commissioning activities in Q2 FY25.
The
30 MTPA slurry pipeline in Odisha is also progressing well, with commissioning
expected in FY27.
The
Company`s consolidated capex spend during Q1 FY25 was Rs 4,466 crores. We
expect consolidated capex for FY25 to be Rs 20,000 crore.
Outlook by the
company
The
global economic outlook for 2024 remains broadly stable compared to 2023.
Global manufacturing PMI continue to improve which along with continued
disinflation increases the likelihood of a soft landing. The IMF forecasts
global GDP growth of 3.2% for 2024. Growth for 2025 is expected to hold steady
at 3.3%, marginal upgrade from its April forecast of 3.2%. Inflationary
pressures are easing across major economies, prompting central banks to
initiate monetary easing measures. Geopolitical risks necessitate monitoring,
particularly their potential impact on supply chains, energy costs and inflation.
In
the US, GDP growth remains robust, driven by a positive trend in consumption
and fixed investments. Despite resilient labour markets, inflation continues to
cool off due to softening wage growth and rents. The recent moderation in
inflation signals potential rate cuts later in 2024.
In
China, while the property sector continues to remain weak, manufacturing,
exports and fixed asset investment (ex-real estate) have continued to grow.
Government has announced targeted measures towards improving the property
sector. GDP growth eased in Q2, partly due to a higher base effect from last
year`s post-Covid reopening. Exports are anticipated to stay steady in the near
term amidst soft domestic demand. Further expansion of government support is
expected to nudge the growth towards the target of 5%.
In
the EU, the ECB has initiated the rate cut cycle in response to easing
inflation. Services PMI has shown expansion since February, while the
manufacturing sector is slowly improving.
In
Japan, wage hikes and tax cuts are expected to support consumption growth.
Manufacturing activity is also showing signs of stabilisation aided by weaker
currency. Overall, economic growth is expected to improve following the
contraction in GDP during Q1 2024.
India`s
strong economic growth momentum is expected to persist, driven by
manufacturing, infrastructure development, and optimistic consumer sentiment.
Despite challenges such as extreme heat waves and slower public capital
expenditure before general elections, the RBI forecasts a 7.2% GDP growth for
FY25. Government capex is expected to recover in the coming quarters, supported
by robust tax revenues and higher RBI dividend, providing fiscal flexibility.
Rising capacity utilization and healthy corporate and financial sector balance
sheets are poised to boost private investment, particularly in manufacturing,
energy transition, and real estate. A favourable monsoon will support the
ongoing recovery in rural demand. The overall macroeconomic outlook remains
robust and is expected to be further strengthened by foreign capital inflows
following inclusion in global bond indices.
The
scrip is currently trading at Rs 889
|
JSW Steel : Consolidated Results
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|
Particulars
|
2406 (03)
|
2306 (03)
|
Var.(%)
|
2403 (12)
|
2303 (12)
|
Var.(%)
|
|
Net Sales
|
42,943
|
42,213
|
2
|
1,75,006
|
1,65,960
|
5
|
|
OPM (%)
|
12.8
|
16.7
|
|
16.1
|
11.2
|
|
|
OP
|
5,510
|
7,046
|
-22
|
28,236
|
18,547
|
52
|
|
Other Inc.
|
164
|
331
|
-50
|
1,004
|
1,030
|
-3
|
|
PBIDT
|
5,674
|
7,377
|
-23
|
29,240
|
19,577
|
49
|
|
Interest
|
2,073
|
1,963
|
6
|
8,105
|
6,902
|
17
|
|
PBDT
|
3,601
|
5,414
|
-33
|
21,135
|
12,675
|
67
|
|
Depreciation
|
2,209
|
1,900
|
16
|
8,172
|
7,474
|
9
|
|
PBT
|
1,392
|
3,514
|
-60
|
12,963
|
5,201
|
149
|
|
Share of Profit/(Loss) from
Associates
|
-12
|
-34
|
65
|
-172
|
-137
|
-26
|
|
PBT before EO
|
1,380
|
3,480
|
-60
|
12,791
|
5,064
|
153
|
|
EO Income
|
0
|
0
|
-
|
589
|
591
|
0
|
|
PBT after EO
|
1,380
|
3,480
|
-60
|
13,380
|
5,655
|
137
|
|
Taxation
|
513
|
1,052
|
-51
|
4,407
|
1,516
|
191
|
|
PAT
|
867
|
2,428
|
-64
|
8,973
|
4,139
|
117
|
|
Minority Interest (MI)
|
22
|
90
|
-76
|
161
|
-5
|
PL
|
|
Net profit
|
845
|
2338
|
-64
|
8812
|
4144
|
113
|
|
EPS (Rs)*
|
#
|
#
|
|
34.4
|
15.2
|
|
|
Notes
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|
* EPS is on current equity of Rs
244.55 crore, Face value of Rs 1, Excluding extraordinary items.
|
|
# EPS is not annualised
|
|
bps : Basis points
|
|
EO : Extraordinary items
|
|
Figures in Rs crore
|
|
Source: Capitaline Corporate
Database
|
|