For Q4FY23, JSW Steel reported quarterly saleable steel sales volumes of 5.68 Million tonnes (MT), up 11% YoY and 15% YoY, higher than our estimate of 5.6 MT. For the quarter, JSW Steel standalone operations reported EBITDA/tonne of | 10998/tonne, as compared to | 8141/tonne in Q3FY23, higher than our estimate of | 10000/tonne.
For Q4FY23, JSW Steel reported consolidated topline of | 46962 crore, up 20% QoQ (our estimate of | 46340 crore). During the quarter, both for the standalone entity as well as consolidated entity, JSW Steel achieved highest ever crude steel production as well as higher ever saleable steel sales volumes.
Standalone EBITDA for the quarter stood at | 6247 crore, up 55% QoQ, higher than our estimate of | 5600 crore. Subsidiaries performance also came in better than our estimate, as a result of which consolidated EBITDA came in significantly higher than our estimate. Consolidated EBITDA for the quarter stood at | 7939 crore, up 75% QoQ, notably higher than our estimate of | 6125 crore. Consolidated EBITDA margin for the quarter stood at 16.9% as compared to 11.6% in Q3FY23 (our estimate of 13.2%).
For Q4FY23, effective consolidated tax rate also in lower than our estimate which also aided a healthy growth in consolidated PAT. Effective tax rate for the quarter stood at 12% lower than our estimate of 26% (34% in Q4FY22). The ensuing consolidated PAT for the quarter stood at | 3741 crore, higher than our estimate of | 1758 crore.
The Board has recommended a dividend of | 3.4/share.
The company’s consolidated net gearing (net debt to equity) was at 0.89x at the end of the quarter (against 1.09x at the end of Q3FY23), and net debt to EBITDA was at 3.2x (against 3.51x at the end of Q3FY23).
Net debt as on March 31, 2022 was at | 59345 crore, down | 10153 crore compared to December 31, 2022 due to healthy cash flow generation and release of working capital.
ICICIdirect Research view on JSW Steel Ltd Stock
View : Domestic steel demand registered healthy growth during FY23, which augured well for JSW Steel. Apparent steel consumption in India was up 14% YoY in Q4FY23 and was up 13% YoY for FY23. Also, the recent softening trend in coking coal prices coupled with healthy debt reduction during Q4FY23 augurs well for the company.
Impact : Positive
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