Jindal Stainless Q4 Review – High Margins; Working capital pressure to ease in FY23: Centrum Broking

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Jindal Stainless Ltd. reported online standalone Ebitda of Rs 7.61 billion (our estimate: Rs 7.39 billion), up 3% QoQ, driven by higher volumes, up around 9% in quarter-on-quarter, supported by higher exports.

Ebitda/ton, at Rs 28,278, however fell by around 5% QoQ but remains at a high level.

In March 2022, Jindal Stainless replaced high cost debt with lower cost resulting in reduction of interest expense by approximately 23% from quarter to Rs 717 million and will further decline in Q1 from exercise 23.

Increased working capital requirements did not allow Jindal Stainless to reduce significant debt in FY22 (FY22 net debt was 29.3 billion rupees compared to 30.7 billion rupees at the end of financial year 21).

With prices having peaked, we see a release of working capital in FY23.

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