Jindal Stainless Posts Strong Q2FY24 Performance, Reports 120% Jump in Consolidated Net Profit

Jindal Stainless Posts Strong Q2FY24 Performance, Reports 120% Jump in Consolidated Net Profit

VoM News Desk | October 20, 2023 | 11:41 AM IST | Breaking News | Follow on Google News

Jindal Stainless Posts Strong Q2FY24 Performance, Reports 120% Jump in Consolidated Net Profit

Jindal Stainless Outperforms Market Weakness: Jindal Stainless Posts Strong Q2FY24 Performance

Jindal Stainless witnessed a remarkable performance in early trade on Friday, with its shares surging over 5%, outperforming the overall market weakness. This positive response from investors comes following the company’s release of its Q2FY24 performance numbers. The company’s consolidated net profit for the September quarter marked a significant increase of 120%, reaching ₹764 crore compared to ₹347 crore recorded in the corresponding period of the previous year.

Robust Growth in Revenue and Sales Volume

The company’s revenue from operations during the September quarter amounted to ₹9,797 crore, representing a year-on-year increase of 12%. The strong growth in sales volume, with 543,619 metric tonnes (MT) sold in the second quarter of FY24, reflects a substantial YoY surge of nearly 26%. This growth is largely attributed to robust domestic demand for stainless steel.

Positive H1FY24 Performance

In H1FY23, Jindal Stainless achieved a consolidated net profit of ₹1,502 crore, indicating an impressive improvement of 75.67% compared to the ₹855 crore net profit in H1FY23. The company reported increased sales in the auto segment and other consumer-facing sectors, with strong momentum leading up to the upcoming festive season.

Interim Dividend Approval

The Board of Directors approved an interim dividend payment equivalent to 50%, amounting to ₹1 per equity share (face value of ₹2 each) for FY24. The record date for determining members’ entitlement for this dividend has been set as October 28, 2023.

Market Performance and Growth

Following the stellar Q2FY24 performance, Jindal Stainless’s stock opened the Friday session at ₹466 per share, up from the previous closing price of ₹450, and further surged to reach an intraday high of ₹474, marking a 5.33% gain. The company ranks among the top stainless steel players in India and globally, excluding China.

Long-Term Growth Prospects and Positive Returns

Jindal Stainless’s shares have delivered significant returns, with substantial growth observed in the last one year (up by 242%) and over the last three and five years (skyrocketed by 672% and 728%, respectively). Since its all-time low of ₹11.60 per share, the stock has seen a remarkable 3865% increase to date. The stock has consistently delivered positive returns in each year since CY19, reflecting the company’s strong performance and growth potential.

Positive Outlook for Stainless Steel Industry

CRISIL, a leading rating agency, has projected a healthy demand outlook for the Indian stainless steel industry. It anticipates a compound annual growth rate (CAGR) of 7.5% for the next 5–10 fiscal years, driven by factors like the demand for environmentally friendly metal in sectors such as railways, process industries, the automobile industry, and architecture, building, and construction (ABC).

Government Initiatives and Infrastructure Projects

Domestic brokerage firm Prabhudas Lilladher highlighted in an August report that the government of India is considering increased usage of Jindal Stainless in various infrastructure projects. These include initiatives such as foot overbridges (FOBs), coaches, metro coaches, and station modernization due to the long life and quality associated with the company’s products.

VoM News Desk

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