Jindal Steel and Power Limited (JSPL) reported a significant rise in its Q2 profits, which soared from ₹219.3 crore to ₹1,390.1 crore year-on-year. The announcement on Wednesday was, however, overshadowed by a 9.2% decrease in consolidated net revenue and a subsequent 7% dip in the company's stock price to ₹590. This decline reduced the firm's market capitalization to ₹60,715.64 crore.
JSPL's shares worth ₹8.68 crore were traded on BSE during this period. Despite a high volatility rate, with a one-year beta of 1.4, and neutral market sentiment reflected in an RSI of 33.4, the company has managed to deliver multibagger returns of 211% over the past three years.
On the downside, Nuvama Institutional Equities and Motilal Oswal revised their target prices for JSPL to ₹879 and ₹730, respectively. This was influenced by weak EBITDA due to lower steel prices, delays in capacity expansion, and projected high capital expenditure in FY25E. Nuvama cut its FY24E/25E EBITDA estimates by 12%/8%, citing lower realization partially offset by higher volume.
Motilal Oswal highlighted JSPL's focus on deleveraging and presence across value-added products (VAP) as positive factors amidst these changes. The firm's standalone revenue stood at ₹12,080 crore (INR100 crore = approx. USD12 million) for the quarter.
InvestingPro Insights
Based on real-time data from InvestingPro, Jindal Steel and Power Limited (JSPL) presents a mixed bag of investment prospects. Despite the recent dip in stock price and revenue decline, InvestingPro data shows that JSPL has maintained impressive gross profit margins and has been profitable over the last twelve months. This strong earnings performance should allow the company to continue dividend payments, offering a potential source of returns for investors.
InvestingPro Tips further reveal that JSPL is a prominent player in the Metals & Mining industry and operates with a moderate level of debt. The company's position within the industry and its prudent debt management can be seen as positive indicators for potential investors.
For those interested in further insights, InvestingPro offers a wealth of additional tips and data, with 5 more tips available for JSPL alone. These are designed to provide a comprehensive understanding of the company's financial health, market position, and future prospects.
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