On Wednesday, the share price of the company rose 2.4 percent to its intraday high of Rs 557.35 per share from its previous close of Rs 544.1 per share after the company acquired a 100 percent stake in Rabirun Vinimay Private Limited.
According to Jindal Stainless Limited’s filing, the company has acquired a 100 percent stake in Rabirun Vinimay Private Limited, a company in liquidation, for Rs 96 crores as part of its goal of expanding cold-rolling capabilities for industries such as auto, appliances, and construction.
Rabirun Vinimay Private Limited (RVPL), a currently non-operational steel manufacturing plant in West Bengal, has the potential to produce 250,000 tonnes of wider and thinner cold-rolled steel per year, along with 50,000 tonnes of pipes and tubes.
According to the financials of Jindal Stainless Ltd, net revenue increased by 11 percent year on year, from Rs 8,750 crore in Q2FY23 to Rs 9,797 crore in Q2FY24. Their revenue fell by 3.7 percent sequentially from Rs 10,183 crore in Q1FY24 to the current levels.
Furthermore, the company’s net profit increased by 120 percent year on year, from Rs 347 crores in Q2FY23 to Rs 764 crores in Q2FY24. Their profit increased by 3.6 percent sequentially from Rs 737 crore in Q1FY24 to current levels.
The company has a low price-to-earnings ratio of 17 compared to its peers, also it has reduced its debt-to-equity ratio to 0.32, with a return on equity of 22 percent and a return on capital employed of 21 percent.
Jindal Stainless Ltd is a midcap company with a market capitalization of Rs 45,371 crores. The company’s share price has increased by 65 percent in the last six months and by 117 percent year to date. For example, if an investor made a Rs 1 lakh investment a year ago, the current value of the investment is Rs 2.17 lakh.
The promoter of the company owns 58 percent of the company, the general public owns 12.6 percent, foreign institutional investors own 23 percent, and domestic institutional investors own 5.4 percent.
Jindal Stainless Ltd is one of India’s largest manufacturers of stainless steel flat products in Austenitic, Ferritic, Martensitic, and Duplex grades, which are used in industries such as automobiles, railways, construction, and consumer goods.
Written by Sriram KV
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