Jindal Stainless Ltd posted Rs 293 cr net profit in Q4FY21

During the Q4FY21 the interest cost reduced by 36% over CPLY to INR 92 crores

Jindal Stainless Ltd posted Rs 293 cr net profit in Q4FY21

New Delhi: The Board of Directors of Jindal Stainless Limited (JSL) today approved the financial results of the Company for Q4FY21. A strong recovery in the domestic stainless steel demand continued in the January-March period and helped sales volume grow by 15% over the corresponding period last year (CPLY) to 255,099 tonnes in Q4FY21. JSL’s EBITDA and profit after tax (PAT) stood at INR 521 crores and 265 crores respectively. Continuing with the deleveraging, the company could further reduce its long term external debt by INR 129 crores during the quarter, which stood at INR 1530 crores.  During the Q4FY21 the interest cost reduced by 36% over CPLY to INR 92 crores.

 

 

The fourth-quarter demand was buoyed by segments like Auto, and a healthy revival in demand from the Pipe & Tube segment, along with Railways & allied infrastructure, including the Metro segment. The demand for special grades in Q4FY21 registered growth due to localisation efforts by the government and Company’s initiatives for innovation. With further push on indigenous production and expected economic recovery, healthy demand is likely to be generated in the future as well. Demand from segments like Elevators and Lifts, and Hollowware also remained strong and is likely to continue.

 

 

On the global scale, stainless steel production was impacted by the onset of the pandemic, and stood at 50.90 million tonne in CY2020, registering a decline of 2.5% over CPLY. Stainless steel melt production in India for CY2020 was at 3.17 million tonnes, registering a decline of 19% over CPLY. Q4FY21 also witnessed further increase in raw material prices globally, wherein Scrap, Nickel, Copper and Ferro Chrome, etc. rose significantly over the Q3FY21 prices. The rally in raw material prices eventually pushed up prices of finished goods globally. This phenomenon was also visible for other commodities, including metal, due to pent up demand and economic recovery.

 

 

Other key developments:

 

1. Merger progress has been satisfactory. The company has obtained necessary approvals from the stock exchanges and SEBI as well, ahead of expected time. The company has filed first motion application before the NCLT.

 

2. The suspension of Countervailing Duty (CVD) in the Union Budget has opened the Indian economy to dumped and subsidized imports from China and Chinese investments in Indonesia. This is likely to adversely impact Indian manufacturing, especially the MSME sectors, pushing it into trading in place of manufacturing

 

 

3. Owing to JSL’s market leadership, stable quantum of exports, and significant improvements in overall operating efficiency, profitability and financial risk profile, the Company was accorded CRISIL Ratings of ‘CRISIL A+/Stable’ to the long-term credit facilities and ‘CRISIL A1’ to the short-term credit facilities. The ratings endorse efficient working capital management by the Company and consistent debt reduction over the past few years.

 

4. Over 40 MT of Liquid Medical Oxygen (LMO) is being dispatched daily from the Company’s Jajpur facility to meet the increasing demand of LMO in Odisha, Andhra Pradesh, and other states, as required. The Company is also airlifting LMO from its Jajpur facility for dissemination in Hisar, as and when required.

 

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