Buy JSW Steel Ltd. - IIFL

- JSW's operational performance was inline with estimate as the impact of higher than expected decline in realisations was offset by lower costs

- The sharp decline in realisations led to a miss in the company's topline. We are negatively surprised by the decline in realisations, as share of semis reduced on a qoq basis

- Volume growth was healthy at 3.9% yoy considering the tough domestic market conditions. The company has gained market share in the domestic market as retail sales volume jump 80% yoy and 16% qoq

- Standalone EBIDTA/ton was inline with our estimate at Rs. 4,908/ton as the impact of higher than expected decline in realisations was offset by higher than expected decline in raw material costs and other expenses

- Higher operating profit at Amba River and lower loses at Salav & US operation led to an outperformance in consolidated operating profit

- JSW would benefit from the decline in raw material costs and safeguard duty in India. Maintain Buy with a price target of Rs. 1,081.

Shares of JSW STEEL LTD. was last trading in BSE at Rs.916.95 as compared to the previous close of Rs. 905.8. The total number of shares traded during the day was 147712 in over 5350 trades.

The stock hit an intraday high of Rs. 920 and intraday low of 902.5. The net turnover during the day was Rs. 134906172.

Source : Equity Bulls

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