JINDAL STEEL & POWER 2017-18 Annual Report Analysis

Sat, 31 Mar

JINDAL STEEL & POWER has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

JINDAL STEEL & POWER Income Statement Analysis

• Operating income during the year rose 38.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 35.6% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 21.8% in FY18 as against 22.3% in FY17.
• Depreciation charges decreased by 1.7% and finance costs increased by 8.5% YoY, respectively.
• Other income declined by 36.8% YoY.
• Net profit for the year declined by 36.1% YoY.
• Net profit margins during the year grew from 13.1% in FY17 to 6.0% in FY18.

JINDAL STEEL & POWER Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	194,048	269,255	38.8%
Other income	Rs m	3,113	1,968	-36.8%
Total Revenues	Rs m	197,160	271,223	37.6%
Gross profit	Rs m	43,369	58,818	35.6%
Depreciation	Rs m	39,490	38,830	-1.7%
Interest	Rs m	37,420	40,595	8.5%
Profit before tax	Rs m	-30,429	-18,641	-38.7%
Tax	Rs m	-5,027	-2,398	-52.3%
Profit after tax	Rs m	-25,402	-16,242	-36.1%
Gross profit margin	%	22.3	21.8
Effective tax rate	%	16.5	12.9
Net profit margin	%	-13.1	-6.0

Don't Miss: Best Chance to Access Midcap Stocks Research at 80% OFF

JINDAL STEEL & POWER Balance Sheet Analysis

• The company's current liabilities during FY18 down at Rs 229 billion as compared to Rs 244 billion in FY17, thereby witnessing an decrease of -6.1%.
• Long-term debt stood at Rs 330 billion as compared to Rs 326 billion during FY17, a growth of 1.1%.
• Current assets rose 7% and stood at Rs 178 billion, while fixed assets fell 3% and stood at Rs 749 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 927 billion as against Rs 941 billion during FY17, thereby witnessing a fall of 2%.

JINDAL STEEL & POWER Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	300,334	303,626	1.1
Current Liabilities	Rs m	243,952	229,094	-6.1
Long-term Debt	Rs m	325,983	329,559	1.1
Total Liabilities	Rs m	941,209	926,867	-1.5
Current assets	Rs m	165,681	177,693	7.3
Fixed Assets	Rs m	775,528	749,174	-3.4
Total Assets	Rs m	941,209	926,867	-1.5

JINDAL STEEL & POWER Cash Flow Statement Analysis

• JINDAL STEEL & POWER's cash flow from operating activities (CFO) during FY18 stood at Rs 77 billion, an improvement of 12.8% on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -14 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs -63 billion on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs 174 million from the Rs -3 billion net cash flows seen during FY17.

JINDAL STEEL & POWER Cash Flow Statement 2017-18

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-17	Mar-18
Cash Flow from Operating Activities	Rs m	68,498	77,243	12.8%
Cash Flow from Investing Activities	Rs m	-19,991	-14,312	-
Cash Flow from Financing Activities	Rs m	-51,077	-62,756	-
Net Cash Flow	Rs m	-2,564	174	-

Current Valuations for JINDAL STEEL & POWER

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs -16.8, an improvement from the EPS of Rs -27.8 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 219.3, stands at -22.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 0.7 times, while the price to sales ratio stands at 0.8 times.
• The company's price to cash flow (P/CF) ratio stood at 8.5 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Sales per share (Unadj.)	Rs	212.1	278.2
TTM Earnings per share	Rs	-27.8	-16.8
Diluted earnings per share	Rs	-24.9	-15.9
Price to Cash Flow	x	8.8	8.5
TTM P/E ratio	x	-42.1	-22.8
Price / Book Value ratio	x	0.3	0.6
Market Cap	Rs m	86,744	192,210
Dividends per share (Unadj.)	Rs	0.0	0.0

Ratio Analysis for JINDAL STEEL & POWER

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 0.8x during FY18, from 0.7x during FY17. The current ratio measures the company's ability to pay short-term and long-term obligations.

Interest Coverage Ratio: The company's interest coverage ratio improved and stood at 0.5x during FY18, from 0.2x during FY17. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

• Profitability Ratios

Return on Equity (ROE): The ROE for the company improved and stood at -5.3% during FY18, from -8.5% during FY18. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 3.5% during FY18, from 1.1% during FY17. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

Return on Assets (ROA): The ROA of the company improved and stood at 2.6% during FY18, from 1.3% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Current ratio	x	0.7	0.8
Debtors’ Days	Days	3	2
Interest coverage	x	0.2	0.5
Debt to equity ratio	x	1.1	1.1
Return on assets	%	1.3	2.6
Return on equity	%	-8.5	-5.3
Return on capital employed	%	1.1	3.5

To see how JINDAL STEEL & POWER has performed over the last 5 years, please visit here.

JINDAL STEEL & POWER Share Price Performance

Over the last one year, JINDAL STEEL & POWER share price has moved up from Rs 121.0 to Rs 219.3, registering a gain of Rs 98.4 or around 81.3%.

Meanwhile, the S&P BSE METAL Index is trading at Rs 13,322.0 (down 2.0%). Over the last one year it has moved up from 11,804.5 to 13,322.0, a gain of 1,518 points (up 12.9%).

Overall, the S&P BSE SENSEX is up 12.1% over the year.

(To know more, check out historical annual results for JINDAL STEEL & POWER and quarterly results for JINDAL STEEL & POWER)

Read: Latest Annual Report Analysis of JINDAL STEEL & POWER