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Maintain buy on JSW Steel, target price Rs 320: Analyst

Prices have recovered sharply over the past two months, strengthening the margin outlook.

Last Updated: Jan 27, 2020, 08.50 AM IST
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Motilal Oswal has maintained buy rating on JSW Steel in the long term with a target price of Rs 320. Shares of JSW Steel ended up 2% at Rs 271.95 on Friday while BSE Sensex closed 226.79 points up (0.55%) at 41,613.19.

Companu Financials

For the quarter ended 31-12-2019, the company has reported consolidated sales of Rs 17666.00 crore, up 2.69% from last quarter sales of Rs 17203.00 crore and down -10.87 % from last year same quarter sales of Rs 19821.00 crore. The company has reported net profit after tax of Rs 214.00 crore in the latest quarter.

The company’s top management includes Dr.Vinod Nowal, Dr.(Mrs.)Punita Kumar Sinha, Mr.Ganga Ram Baderiya, Mr.Haigreve Khaitan, Mr.Harsh Charandas Mariwala, Mr.Hiroyuki Ogawa, Mr.Jayant Acharya, Mr.M V S Seshagiri Rao, Mr.Malay Mukherjee, Mr.Sajjan Jindal, Mr.Seturaman Mahalingam, Mrs.Nirupama Rao, Mrs.Savitri Devi Jindal. Company has S R B C & Co. LLP as its auditors. As on 31-12-2019, the company has a total of 2,417,220,440 shares outstanding.

Investment Rationale

Prices have recovered sharply over the past two months, strengthening the margin outlook, said Motilal Oswal. The brokerage estimates EBITDA/tonne to improve around 50% sequentially to ?9,000 in fourth quarter of FY20. The brokerage has cut its estimate marginally for FY21 to factor in the delay in the commissioning of the Dolvi plant.
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