Buy JSW Steel Maintains HDFC Securities

The brokerage maintain a Buy rating and a target price of Rs 1,080/share, valuing it at 8x FY27E consolidated Ebitda. JSW Steel has traded at a similar mean multiple in the past five years. The brokerage have also ascribed 50% value to the FY27E capital work in progress and long-term investments to arrive at our fair value.

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HDFC Securities Institutional Equities

We maintain Buy rating on JSW Steel Ltd. with an unchanged target price of Rs 1,080/share. We interacted with the management on business outlook. The ramp-up of recently commissioned 6 million metric tonne steel capacities across Vijayanagar and BPSL plants has accelerated production in Q4 FY25 and sales should also remain strong (we estimate 15% YoY consolidated volume growth in Q4 FY25).

Demand remains strong and prices of flats have improved by ~Rs 300/MT QoQ. Management expects steel prices to benefit from expected implementation of safeguard duty on imports from China and other FTA countries.

We estimate JSW Steel will deliver 9/13% volume/Ebitda CAGRs during FY24-27E, riding on production ramp-up, expected pricing recovery and various efficiency improvement projects.

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