Highest wealth creator in Steel Sector in the last 1 year

Jindal Steel & Power Ltd touched its 52 week and 8 year high of Rs.373.45 per share amidst the strong performance by steel sector. The steel sector has been performing strongly and has been the star performer since the beginning of 2021. Jindal Steel & Power Ltd has been a 6 times bagger since the last year. With increased volumes every trading session the delivery percentage has been in the range of 20% on a monthly basis.

Its peers like Tata Steel Ltd has given 3.54x return JSW Steel has given 3.87x. Indian steel players have increased the prices of steel by Rs. 4000-5000 per tonne as the demand for Indian steel has increased substantially as the Chinese have stopped supplying to Vietnam which has led to increased exports by Indian Players. Additionally, steel production by JSPL has increased by 18% y-o-y to 6.53 lakh tonnes as compared to 5.54 lakh tonnes in the previous year.

It has also seen an upgrade in its ratings for long and short term bank facilities and Non-Convertible Debentures i.e from CARE BBB (+)/Stable to CARE A (-)/ Stable on the LTF/NCDs and from CARE A2 to CARE A2+ for STF.

The company's Net debt has reduced by approx. Rs 10,298 cr in 9MFY21 to Rs 25,621 Cr and is expected to see a further reduction in the near and medium term. Net Debt to EBITDA (Trailing) at the end of December'20 stood at 2.35 x (vs 3.52x as on September'2020).

3QFY21 also saw JSPL becoming India's first private company to get the "Regular Supplier" status from Indian Railways to supply 60kg 880 grade (90UTS) Rails.

In February, 2021, Edelweiss Securities mentioned they are positive on the volume ramp up besides its the focus on value over volume and maintained a buy rating on the company with a target price of Rs 378.

The company trades at a P/E of 8.75 against its sectoral P/E of 41 and its market capital currently stands at Rs 37,796.69 cr.

Shares of JINDAL STEEL & POWER LTD. was last trading in BSE at Rs.370.55 as compared to the previous close of Rs. 343.85. The total number of shares traded during the day was 986303 in over 12603 trades.

The stock hit an intraday high of Rs. 373.45 and intraday low of 345.8. The net turnover during the day was Rs. 355923069.

Source : Equity Bulls

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