Jindal Stainless (Hisar) in demand after Q4 results

Jindal Stainless (Hisar) jumped 6.47% to Rs 51.05 after consolidated net profit rose 12.1% to Rs 108.35 crore on 17.4% decline in net sales to Rs 2246.07 crore in Q4 March 2020 over Q4 March 2019.

Consolidated profit before tax stood at Rs 68.07 crore in Q4 March 2002, declining 48.8% from Rs 132.93 crore posted in the same period last year. The result was announced after market hours yesterday, 10 June 2020.

On a standalone basis, net profit gained 43% to Rs 93.79 crore on a 14% decline in net sales to Rs 2030.32 crore in Q4 March 2020 over Q4 March 2019. The company said there has been a positive impact on tax expenses of Rs 57 crore and Rs 22 crore respectively for the quarter and year ended 31 March 2020 respectively as it adopted a new tax regime.

Standalone EBITDA declined 20% to Rs 174 crore in Q4 March 2020 from Rs 217 crore reported in the same period last year. EBITDA margin fell to 8.6% in Q4 March 2020 from 9.2% in Q4 March 2019.

Commenting on the financial performance, managing director, Jindal Stainless (Hisar), Abhyuday Jindal, said, "The performance of JSHL was stable despite global uncertainties and weak growth in the last quarter of the FY20. Our Specialty Products Division, which supplies high-end stainless steel products like precision strips, blade steel, and coin blanks to global markets, grew by 13% on an annual basis. Import intensity remained high during the quarter, amounting to nearly 30% of the entire market share, forcing domestic industries to operate at reduced capacities. With the recent announcements by the Government in favour of domestic industries, we are expectant that undue pressure exerted by subsidized and irrational imports will abate at last."

With the stainless steel sector having a direct correlation with the GDP growth of the country, disruption in the overall economic activity in the country on account of COVID-19 subdued economic sentiment for this sector as well Jindal Stainless (Hisar) said. The company further added that strong business fundamentals of the company will help avoid a significantly adverse impact on the operations and performance of the company.

Going forward, the company said it is focusing on export orders at the moment. The gap expected to be created by subsidised Chinese industries vacating global markets may provide thrust to the Indian stainless steel industry.

The company's net debt stood at Rs 2,000 crore as on March 2020 compared with Rs 2,162 crore as on March 2019.

Jindal Stainless (Hisar) is the largest specialty stainless steel producer in India with a diversified value-added product portfolio. The company operates an integrated stainless steel plant at Hisar, Haryana. JSHL has a total melting capacity of 0.8 million tonnes per annum.

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