Release Date: October 18, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Jindal Stainless Ltd (BOM:532508, Financial) maintained stable export volumes despite challenges in ocean freights and weaker economic activity in key markets like the EU and US.
- The company witnessed stable growth in the domestic market, particularly in segments like railway coaches, lift elevators, and white goods.
- Jindal Stainless Ltd (BOM:532508) commissioned its nickel pig iron smelter facility in Indonesia eight months ahead of schedule, aligning with the Atmanirbhar Bharat mission.
- The company has been accredited by Brahmos Aerospace as a qualified vendor for manufacturing and supplying steel sheets and plates for cruise missile applications.
- Jindal Stainless Ltd (BOM:532508) received recognition for its ESG efforts, including the Energy Efficient Unit Award and the Platinum Global Environment Award 2024.
Negative Points
- Export markets faced headwinds due to weaker economic activity in the EU and slowing sectors in the US, impacting sales volumes.
- The company had to revise its volume growth guidance from 20% to 10-15% due to slower-than-expected recovery in export markets.
- There was a slight dip in sales volume on a quarter-to-quarter basis, with a 2% decrease.
- The company is facing challenges with Chinese imports affecting sales in lower-end segments.
- The ramp-up of new projects like Rathi and Rabirun is still in progress, with some delays in achieving breakeven on EBITDA.
Q & A Highlights
Q: Recently, the ETR initiated investigations into the import of Chinese stainless-steel tubes. Do we see any possibility of protection for our range of products as well?
A: Absolutely, Amit. That is definitely on the cards. We are working on organizing data collection from various MSME and other competitors, and we expect to apply for some kind of anti-dumping duty soon. - Abhyuday Jindal, Managing Director
Q: What is the status of the ongoing projects, particularly the ramp-up of Rathi and Rabirun, and the NPI project?
A: For Rathi, we have produced around 50,000 tonnes in H1, aligned with our projections, and expect 65% to 70% capacity utilization this year. Rabirun is still in the ramp-up phase. The NPI project was commissioned ahead of schedule, and we expect the stainless-steel project to commence before the two-year timeline. - Abhyuday Jindal, Managing Director and Tarun Khulbe, CEO
Q: We had given a volume guidance number of 20%. Do we still stay put to it, or would we look to revise the number?
A: We would like to revise our volume growth guidance down from 20% to 10%-15% due to the lack of recovery in export markets like Europe and the US. However, we remain positive on the domestic growth story. - Abhyuday Jindal, Managing Director
Q: What is your priority in terms of ramping up different projects like Chromeni, SMS, Rathi, RVPL, and Chromeni?
A: Chromeni is our priority because it can immediately add to our bottom line and top line volume growth. The other projects are on an even footing. - Abhyuday Jindal, Managing Director
Q: On the NPI venture, is it currently viable at the $17,000 nickel price, and what is the long-term viability of this project?
A: The strategic objective of backward integration and raw material security remains intact. Profitability may vary with nickel prices, but we maintain a stable inventory management level to hold stable margins. - Anurag Mantri, Group CFO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
