Buy Jindal Steel & Power, target price Rs 750: ICICI Securities

ICICI Securities has buy call on Jindal Steel & Power with a target price of Rs 750. The current market price of Jindal Steel & Power is Rs 599.15.

Jindal Steel & Power Ltd., incorporated in the year 1979, is a Mid Cap company (having a market cap of Rs 60659.54 Crore) operating in Metals - Ferrous sector.

Jindal Steel & Power Ltd. key Products/Revenue Segments include Iron & Steel Items, Power, Other Sales, Other Operating Revenue, Export Incentives, Scrap for the year ending 31-Mar-2021.


Financials
For the quarter ended 30-09-2022, the company reported a Consolidated Total Income of Rs 13521.88 Crore, up 3.46 % from last quarter Total Income of Rs 13069.17 Crore and down -.69 % from last year same quarter Total Income of Rs 13615.49 Crore. Company reported net profit after tax of Rs 219.29 Crore in latest quarter.


Investment Rationale
Despite estimates of realisation remaining range-bound through to FY25E, we raise FY24E EBITDA by 24% taking cognizance of higher volumes and cost efficiencies. The brokerage value JSPL at 6x FY24E EBITDA resulting in a revised target price of Rs750/share (earlier: Rs605). Maintain BUY. Higher than expected fall in steel prices and delay in commissioning of upcoming capacity at Angul are the key risks in our view.

Promoter/FII Holdings
Promoters held 60.44 per cent stake in the company as of 30-Jun-2022, while FIIs owned 10.65 per cent, DIIs 15.75 per cent.