Stocks

JSW Steel approves stock split, to raise Rs 2,000 cr to repay debt

Our Bureau MumbaiOct 27 | Updated on January 16, 2018

JSW Steel has reported multi-fold increase in September quarter net profit at Rs 726 crore (Rs 56 crore) on the back higher production and better realisation.

Total income was up 20 per cent at Rs 14,421 crore (Rs 11,993 crore).

The company’s saleable steel production increased 20 per cent to 3.84 million tonnes as it ramped up output from the recently commissioned blast furnaces at Vijayanagar in Karnataka and Dolvi in Maharashtra.

With the slowdown in domestic demand, JSW increased

exports and focused on value added steel products which accounted for 20 per cent of total sales while branded

steel products’ sales grew 11 per cent.

To raise Rs 2,000 cr, Stock split

The Board of Directors have approved stock split of the company's equity shares with face value of Rs 10 each into ten equity shares of face value of Rs 1 each to make it affordable for small investors to participate in the company’s growth story.

The Board also approved a proposal to raise Rs 2,000 crore through issue of Non-Convertible Debentures.

The proceeds from the issue would be used for refinancing expensive debt and meet long term working capital, it said.

JSW has been declared a 'preferred bidder' for five mines in the category ‘C’ mine auctions conducted by the Karnataka government in October.

These mines have estimated resource of about 111 million tonnes as per the tender

document, it said.

Subsidiary cos performance

During the quarter, JSW Steel Coated Products registered a production of 0.45 million tonnes and sales of 0.44

million tonnes. Total income from operations and Operating EBITDA for the quarter was at Rs 2,389 crore and Rs 167 crore, respectively. Net profit was Rs 79 crore from this division.

The US-based plate and pipe mill facility produced 48,787 tonnes of plates and

12,249 tonnes of pipes, reporting a capacity utilization of 20 per cent and 9 per cent,

respectively. It reported an Ebitda of $0.22 million

for the quarter.

Seshagiri Rao, Joint Managing Director, JSW Steel said steel production in India grew 7.5 per cent in the first half of this fiscal while steel demand was up 3.6 per cent.

On the other hand, he said despite various trade remedial measures steel imports have come down by only 35 per cent against expectations of a 50 per cent. Therefore, progress on effective trade measures is required for the health of the industry while the steel demand growth outlook is gradually improving, he added.

Shares of the company were down two per cent at Rs 1,626 on Thursday.

Published on October 27, 2016

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