Add Jindal Steel & Power, target price Rs 583: Centrum Broking

Centrum Broking has add call on Jindal Steel & Power with a target price of Rs 583. The current market price of Jindal Steel & Power is Rs 541.55.

Jindal Steel & Power, incorporated in the year 1979, is a Mid Cap company (having a market cap of Rs 55115.36 Crore) operating in Metals - Ferrous sector.

Jindal Steel & Power 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 has 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 has reported net profit after tax of Rs 219.29 Crore in latest quarter.

The company’s top management includes Mrs.Savitri Jindal, Mr.Sunil Kumar Agrawal, Ms.Kanika Agnihotri, Mrs.Shivani Wazir Pasrich, Mr.Sunjay Kapur, Dr.Bhaskar Chatterjee, Dr.(Mrs.)Aruna Sharma, Mr.D K Saraogi, Mr.Naveen Jindal, Mr.Ramaswamy Ramkumar. Company has Lodha & Co. as its auditors. As on 30-06-2022, the company has a total of 102 Crore shares outstanding.

Investment Rationale
The brokerage factors in higher steel prices than earlier estimated resulting 25% and 12% increase in FY23E and FY24E earnings respectively. Hence, it increases its target price to Rs 583 (earlier: Rs467), valuing at 4.5x FY24E &FY25E average EV/EBITDA. A prudent capital allocation policy is awaited for re-rating in the stock.

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.