Jindal Stainless Limited delivers strong financial results for the quarter ended March 31, 2022

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The Board of Directors of Jindal Stainless Limited (JSL) took on record the financial results for Q4FY22 recently. The Company maintained a strong performance on  the back of adaptive strategies in supply chain and product basket management. Despite volatility and global disruptions in raw material supply and logistics, the Company effectively doubled its exports sales proportion to 32% of total sales volumes in Q4FY22 as compared to 16% Q4FY21, with a keen focus on the value-added product segments. 

  • The standalone revenue, EBITDA and  PAT grew by 65%, 46% and 152% respectively over Q4FY21. Net external debt stood at INR 1,546 crores as on March  31, 2022, with debt-to-equity ratio reduced to ~0.6.  Interest cost reduced by 25% to INR 68 crores for Q4FY22 as compared to CPLY. 
  • On a consolidated basis, JSL recorded a revenue of INR  6,564 crores during Q4FY22. EBITDA and PAT stood at INR 842 crores and INR 750 crores respectively. Key domestic sectors like elevators and escalators, railway wagons, railway  coaches and metro continued to register a steady demand.
  • JSL is closely working  with major domestic players across these segments to customize products as per their requirement. Under its ‘Local to Global’ initiative, JSL is in the process of providing customized product solutions for international operations of select domestic customers having a global presence.
  • The Company supplied various critical grades like Super Duplex and Cobalt restricted stainless steel for various indigenous nuclear applications and key fertilizer projects. A diversified  market  presence  and  increased proportion of exports mix partially compensated for the lower domestic sales in certain sectors.  
  • Dumping of imported and subsidized material from China and Indonesia led to a muted domestic demand and reduced price levels.This also resulted in the share of imports rising to 36% of demand in Q4FY22 as compared to 24% in Q4FY21.

Domestic-export share of sales volumes during Q4FY22 was as follows:

Geographical Segment Q4FY22 Q4FY21 FY21-22 FY20-21
Domestic 68% 84% 75% 81%
Export 32% 16% 25% 19%

The  international  nickel  and  ferro-chrome  prices  jumped  by  52%  and  121% respectively in Q4FY22  on  a  YoY  basis.  The  ongoing  Russia-Ukraine unrest  adversely impacted the global supply chain and commodity prices. On the domestic front, Chinese and Indonesian imports of subsidized stainless steel products continued to disrupt the Indian market. It is estimated that imports from China and Indonesia rose by 147% and 280% respectively in FY22 on CPLY basis.

Other key developments:

  • The  Board  of  Directors of  JSL  approved  modification  in  the  existing dividend policy of the Company providing interalia that efforts will be made to target dividend upto 20% of PAT of the Company on progressive basis in future.
  • India’s  first-ever  stainless  steel  foot-over-bridge  (FOB)   was  inaugurated  in  Naupada, Andhra Pradesh. JSL played a key role, not only as the key raw material supplier, but also in developing the overall ecosystem required for promoting the use of stainless steel in such new-age infrastructure projects.
  • JSL signed a Memorandum of Understanding (MoU) with the prestigious Indian Institute of Technology  (ISM),  Dhanbad  to  jointly  carry  out  research,  new  product  development, environment safety, and skill development. This is in line with the Company’s aim to promote industry-institute partnerships.
  • Merger  update: Shareholders and creditors of JSL and JSHL approved the ‘Scheme of Arrangement’ for the merger between  the  two  Companies on  April  24,  2022 by  an overwhelming  majority.  The  Companies  will  now  file  the  second  motion  petition  with Hon’ble NCLT.With  this  positive  movement,  the  Companies  now  expect  other  relevant processes to be completed in due time, in the next 6-7 months.
  • Renewable  Energy  and  ESG  efforts: JSL procured renewable energy in  bulk to  reduce CO2 emissions by ~1300 metric  tonnes and  continued  its  process  improvement  measures  to further bring down carbon emission.Company’s plans for exploring renewable energy and low  carbon  energy  transition  are  on  track. JSL  is also actively monitoring  its  operational performance  through  third  party  scrutinizers;  including stack,  ambient  air  quality,  work zone, effluent analysis,surface water and ground water analysis.
  • Projects update: All brownfield expansion projects announced in Q1FY22 are on track.

Financial Performance Summary (figures in INR crores):

Particulars Consolidated
Q4FY22 Q4FY21 Change FY21-2 FY20-21 Change
SS Sales Volume (MT) 269,168 255,099 6% 1,011,292 824,825 23%
Total Revenue (net) 6,564 3,914 68% 21,223 12,188 74%
EBITDA 842 542 55% 2,987 1,424 110%
PAT 750 293 156% 1,909 419 355%
Particulars Standalone
Q4FY22 Q4FY21 Change FY21-2 FY20-21 Change
SS Sales Volume (MT) 269,168 255,099 6% 1,011,292 824,825 23%
Total Revenue (net) 6,287 3,810 65% 20,312 11,679 74%
EBITDA 761 521 46% 2,791 1,396 100%
PAT 669 265 152% 1,674 428 291%

On  a  yearly  basis, FY22 standalone sales  volume stood at 1,011,292 metric tonnes,  up  by 23% over FY21. Net revenue, PAT and EBITDA of the Company were INR 20,312 crores, INR 1,674 crores and INR 2,791  crores respectively.A prudent  financial management led the interest  cost to  fall by  32%  over  FY21  to  INR  317 crores. During FY22, JSL’s consolidated EBITDA, PAT and revenue stood at 2,987 crores, 1,909 crores, and 21,223 crores.

Commenting  on  the  performance  of  the  Company, Managing Director,  JSL, Mr  Abhyuday Jindal Said, “JSL’s strategic decision to focus on export sales to strengthen its niche value-added product portfolio resulted in a robust performance. This also enabled the Company to steer  through certain challenging  segments in  the  domestic  market that  faced subsidized imports  from  China  and  Indonesia.  We Continue  to  work  closely  with  our  customers  to develop  new  products  and  the  ecosystem,  for  catering  to  new  opportunities  of  stainless steel applications in infrastructure and emerging focused sectors like Green Hydrogen and ethanol. We   are also   proactively   switching   from   thermal   to   renewable   energy infrastructure at our plant premises, and are working towards our goal of net zero carbon emissions by 2050.”

Source: Jindal Stainless Limited-Press Release | Image Credit (representational): JSL

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