Companies

JSW Steel Q4 net soars to ₹4,191 crore

Our Bureau Mumbai | Updated on May 21, 2021

The company plans to raise ₹5,000 crore through rights issue

JSW Steel’s consolidated net profit jumped to ₹4,191 crore in the March quarter, against ₹188 crore in the same period last year, due to higher realisation.

Sales increased 51 per cent to ₹26,456 crore (₹17,556 crore).

The company made impairment provision of ₹83 crore relating to the US coal business towards the value of property, plant and equipment and goodwill on the basis of values determined by independent external valuers using cash flow projections of respective businesses and assets.

Operating EBITDA was up 149 per cent at ₹8,021 crore led by enhanced spreads, favourable product mix and continued upward trend in steel prices. Overall volume of iron ore from captive mines accounted for 42 per cent of total requirement.

The recovery in global and domestic demand recovered with large fiscal and accommodative monetary stimulus extended by governments and central banks that facilitated faster V-shaped recovery. However, the emergence of a second wave of Covid in India has dampened the sentiment due to widespread localised lockdowns in several parts of the country, said the company.

Fund-raising

The company plans to raise ₹5,000 crore through rights issue and another ₹7,000 crore through issue of non-convertible securities to institutional investors to fund its growth plans.

The company will invest ₹25,115 crore over the next three fiscal in various projects. It will expand steel-making capacity by 5 mtpa at Vijayanagar to 17 mpta with an investment of ₹15,000 crore.

In a bid to boost captive iron ore supply, it plans to invest ₹3,450 crore to improve efficiency at the four iron ore mines in Odisha by creating infrastructure to reduce reliance on outsourced mining, implement digitalisation and set up grinding and washing facilities to improve the quality of the ore which will lead to higher productivity at the steel-making operations.

JSW Steel will invest ₹100 crore in the 0.12 mtpa colour coated downstream steel facility in Jammu and Kashmir to meet the growing demand and support economic development.

The company has commissioned pellet plant, coke oven battery and Hot Strip Mill for plate rolling as part of doubling capacity to 10 mtpa at Dolvi. However, the work on blast furnace and steel melt shop has been impacted by Covid disruptions and the company expects to have fully integrated operations by September.

Published on May 21, 2021

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