Jindal Stainless Q4 Results: Profit Falls 30%, Misses Estimates

The stainless steel manufacturer's net profit dropped 30% year-on-year to Rs 501 crore in the January-March quarter.

<div class="paragraphs"><p>Jindal Stainless. (Source: Company website)</p></div>
Jindal Stainless. (Source: Company website)

Jindal Stainless Ltd. reported a fall in net profit for the fourth quarter of fiscal 2024, missing analysts' estimates.

The stainless steel manufacturer's net profit dropped 30% year-on-year to Rs 501 crore in the January-March quarter, according to an exchange filing issued on Wednesday. This compares with the Rs 578-crore consensus estimate of analysts polled by Bloomberg.

Revenue from operations declined 3.2% to Rs 9,454 crore during the period, missing estimates.

The board recommended a payment of final dividend of Rs 2 per share for fiscal 2024.

Jindal Stainless Q4 FY24 Highlights (Consolidated, YoY)

  • Revenue down 3.2% to Rs 9,454 crore versus Rs 9,765 crore (Bloomberg estimate: Rs 9,605 crore).

  • Ebitda declined 9.5% to Rs 1,035 crore versus Rs 1,144 crore (Bloomberg estimate: Rs 1,061 crore).

  • Ebitda margin narrowed 80 basis points to 10.9% versus 11.7% (Bloomberg estimate: 11%).

  • Net profit down 30% to Rs 501 crore versus 716 crore (Bloomberg estimate: Rs 578 crore).

Key Highlights

The company's sales volume rose 12% year-on-year to 5,70,362 tonne during the quarter, the highest-ever recorded for any quarter.

Imports from China continued to surge at ~1,40,000 tonne, a ~20% year-on-year increase.

Margin Contraction

  • Margin remained under pressure on account of negative inventory valuation due to continuously falling nickel prices.

  • Key export markets, such as Europe and the US, remained weak.

  • The Red Sea crisis during the quarter further led to a steep increase in ocean freight and constrained availability of containers, consequently compressing margin.

Key Developments

Jindal Stainless supplied high-strength stainless steel to India’s first Vande Metro train. The company supplied 201LN grade of high-strength stainless steel for the first time, making coaches lighter and more energy-efficient, it said.

Recently, Jindal Stainless had announced major acquisition and expansion plans of Rs 5,400 crore to augment its melting and downstream facilities to reach a capacity of 4.2 million tonne per annum.

This included a 49% partnership in a joint venture for a 1.2 MTPA stainless steel melt shop in Indonesia, expansion in downstream capacity in Jajpur and Odisha, and acquisition of 54% equity stake in Chromeni Steels in Mundra, Gujarat.

Jindal Stainless To Invest Rs 5,400 Crore In Acquisitions, Capacity Expansion

Shares of Jindal Stainless closed 3.49% lower at Rs 686.80 apiece, as compared with a 0.08% fall in the Nifty 50.