Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.

Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Jindal Saw: A brief overview - Views on News from Equitymaster
  • E-MAIL
  • A  A  A
  • May 17, 2007

    Jindal Saw: A brief overview

    About the company: Incorporated in 1984, Jindal Saw Ltd. (JSL) is the only Indian pipe manufacturer with capabilities to produce HSAW (helical submerged arc welded pipes), LSAW (longitudinal submerged arc welded pipes), seamless and DI (ductile iron) pipes. JSL also holds the distinction of being the only Indian player to have a manufacturing facility in the U.S. Over the years, the company has firmly established as a reputed supplier in the international markets, with exports accounting for 66% of revenues in FY06.

    Product Mix: Through its multi-product offering, JSL caters to diverse user segments energy transportation sector, industrial applications and water and sewage transportation.LSAW pipes are primarily used in oil & gas industry, while HSAW pipes find application in the oil & gas industry and water transportation. On the other hand, DI pipes are used for water transportation, sanitation and housing. As can be seen in the chart below, the company derives a chunk of its revenues from SAW Pipes and US operations.

    Manufacturing facilities and capacity: The company's saw pipes are manufactured at three manufacturing facilities, located at Kosi Kalan (U.P.), and at Nanakapaya and Samaghoga in Mundra. The manufacturing plants at Mundra were set up to cater to the exports, as port based facilities reduce transportation cost from India to Middle East. The company's seamless tubes and pipes are manufactured at Nashik, Maharashtra. The company also has two affiliates, Saw Pipes, USA and Jindal United Steel Corporation (JUSCO).

    Manufacturing capacity (TPA)
    Location Saw Pipes Seamless Tubes DI - CI Pipes
    (HSAW and LSAW)
    Kosi-Kalan, UP 250,000 - -
    Nashik - 100,000 -
    Mundra (IPU) 350,000 - 200,000
    Mundra (EOU) 350,000 - -
    Total 950,000 100,000 200,000

    Order Book position: As of January 2007, the company had an order book of around US$ 1,200 m (around Rs 52 bn), with LSAW pipes accounting for almost 88% of the same.

    Order Book
    Segments US$ (m)
    India 800
    LSAW 700
    HSAW 50
    Seamless & DI 50
    USA 400
    LSAW 350
    Plates 50
    Total 1,200

    Financial Performance: Jindal Saw has registered a robust 53% CAGR in topline between FY03 to FY06. Average operating margins during the same period stood at 11.5%, whereas average net margins were 4.6%. Due to decline in operating margins, the growth in net profit was slower at 23%. Since steel accounts for 70% of the total raw material cost, increase in steel prices has had a negative impact on the operating margins.

    Financial Performance - Standalone numbers
    Particulars 2003 2004 2005 2006 3 Yr CAGR/Avg.
    Sales 6,930 10,821 23,136 38,557 53.6%
    Operating expenses 5,341 9,500 20,465 34,457  
    EBIDTA 1,589 1,320 2,672 4,099 26.7%
    EBDITA margins 22.9% 12.2% 11.5% 10.6% 11.5%
    Other income 20 60 144 231  
    Depreciation 184 219 354 519  
    Interest 381 387 947 1,262  
    Profit before tax 1,044 775 1,515 2,550  
    Extraordinary items - - - 83  
    Tax 283 212 508 871  
    PAT 761 562 1,007 1,762 23.4%
    Net Profit margin 11.0% 5.2% 4.4% 4.4% 4.6%



    Equitymaster requests your view! Post a comment on "Jindal Saw: A brief overview". Click here!

    1 Responses to "Jindal Saw: A brief overview"


    Jun 7, 2010

    what about jsw steel in future market

    Like (1)
    Equitymaster requests your view! Post a comment on "Jindal Saw: A brief overview". Click here!

    More Views on News

    Tejas Networks Ltd. (IPO)

    Jun 14, 2017

    Should you subscribe to the IPO of Tejas Networks Ltd?

    Discover the Secrets of Hidden Smallcaps From These AGMs (The 5 Minute Wrapup)

    May 26, 2017

    Don't be surprised to come across some Super Investors there!

    A Trader's Nightmare. A Business Owner's Delight. (The 5 Minute Wrapup)

    May 19, 2017

    Not all small-cap investors see themselves as traders. Some see themselves as business owners.

    Securities & Intelligence Services Ltd. (IPO)

    Jul 31, 2017

    Should you subscribe to the IPO of Securities & Intelligence Services Ltd?

    Why Super Investors are Underperforming in This Market (The 5 Minute Wrapup)

    Jul 8, 2017

    If Super Investors can wait for the right pitch, so can you.

    More Views on News

    Most Popular

    Demonetisation Barely Made Any Difference to Tax Collections(Vivek Kaul's Diary)

    Aug 7, 2017

    The data tells us quite a different story from the one the government is trying to project.

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    7 Financial Gifts For Your Sister This Raksha Bandhan(Outside View)

    Aug 7, 2017

    Raksha Bandhan signifies the brother-sister bond. Here are 7 thoughtful financial gifts for sisters...

    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms