During Wednesday’s trading session, the shares of a steel tube manufacturing company surged nearly 5 percent to Rs. 209.5 on BSE, after the company announced receiving an order worth Rs. 265 crores for the Jal Jeevan Mission.
With a market cap of Rs. 3,876.8 crores, the shares of JTL Industries Limited closed in the green at Rs. 208.3, up by nearly 4.4 percent, as compared to its previous closing price of Rs. 199.55.
What’s the news:
According to the latest regulatory filings with the stock exchanges, JTL Industries Limited emerged as the L1 bidder for the Jal Jeevan Mission project, securing an order valued at Rs. 265 crores.
The order entails the supply of ISI-certified Galvanized Mild Steel (GMS) tubes for 95 percent of the required sizes, totalling 35,473 MT of the total order.
About the Jal Jeevan Mission:
The Jal Jeevan Mission (JJM), launched by India’s Ministry of Jal Shakti, aims to provide functional household tap connections (FHTC) to every rural household by 2030.
The initiative addresses critical water access and quality issues, with the goal of transforming rural health and sanitation while reducing waterborne diseases. As of August 2024, nearly 15.07 crore rural households have been connected, achieving a coverage rate of nearly 78 percent.
The mission places a strong emphasis on community-led planning, sustainability, and technological solutions for monitoring water supply.
Additionally, it promotes rural empowerment, especially for women, by reducing the time spent on collecting water and improving overall living standards.
Previous News:
On 26th October, the company’s Board approved the sub-division/split of 1 equity share with a face value of Rs. 2 each, into 2 equity shares with a face value of Rs. 1 each, and fixed 15th November as the record date.
On 30th October, JTL announced the expansion of its Raipur facility’s capacity from 1 lakh metric tons per annum (MTPA) to 2 lakh MTPA.
Following this expansion, the company’s total pipe manufacturing capacity reached around 6.86 lakh MTPA, reflecting JTL’s ongoing commitment to achieving a production target of 1 million MTPA by year-end.
With this expansion, the Raipur plant will add 200 new stock-keeping units (SKUs), further strengthening the company’s ability to offer a broader range of high-quality steel products.
Financials:
The company reported a marginal decline in revenue from operations, experiencing a year-on-year decrease of nearly 4.5 percent, falling from Rs. 502 crores in Q2 FY24 to Rs. 480 crores in Q2 FY25.
Likewise, during the same period, the company’s net profit decreased from Rs. 28 crores to Rs. 26 crores, representing a marginal decline of around 7.2 percent YoY.
In terms of EBITDA, JTL posted a fall from Rs. 43.8 crores in Q1 FY25 to Rs. 37.6 crores in Q2 FY25, reflecting a decline of about 14 percent QoQ. Further, the EBITDA margin also decreased by 70 bps QoQ from 8.4 percent to 7.7 percent, over the same period.
Management Guidance:
JTL is planning to deploy DFT and colour-coated lines in its plants, which would enable the company to produce various SKUs, thereby increasing efficiency and capacity utilization.
The company has raised Rs. 675 crores through a preferential allotment by promoters, which is expected to boost the planned capacity expansion. It further aims to enhance its manufacturing capacity to 1 Million MTPA by the end of FY25.
The management expects sales volume to grow by nearly 30-35 percent from FY24 to FY25, driven by a higher contribution of value-added products in the sales mix.
EBITDA per tonne for FY25 is expected to grow owing to new products, increasing share of VAP and better capacity utilisation.
This year, JTL has set a goal to raise its proportion of VAP to more than 40 percent, as a part of its strategic plan to enhance business performance and improve margins from its product offerings.
Stock Performance:
The stock has delivered negative returns of nearly 7 percent in one year, as well as around 11.5 percent returns in the last six months. So far in
2024, the shares of JTL Industries have given negative returns of about 12.5 percent.
About the company:
Incorporated in 1991, JTL Industries Limited, formerly known as JTL Infra Limited, is primarily engaged in the business of manufacture and sale of Iron and Steel products, and its product offering includes GI Pipes, MS Black Pipes, Hollow-sections, and Solar Structures amongst others which cater to diverse industrial and infrastructural applications.
The cumulative capacity of the company is around 6.86 lakh MTPA for pipe manufacturing and nearly 3 lakh MTPA is backward integration.
Written by Shivani Singh
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