Jindal Steel and Power share price declines 13% post Q3 results Do you own it

Jindal Steel and Power share price declines 13% post Q3 results: Do you own it ?

Jindal Steel and Power Shares Plunge Over 13% Post-Q3 Results

Jindal Steel and Power (JSPL) shares took a sharp hit in early trading on Friday, tumbling over 13% after the company announced its Q3 FY25 results post-market hours on Thursday.

The stock opened at ₹799.85 on the BSE, already 5% lower than its previous close of ₹840.10. As the session progressed, the share price dropped further, hitting an intraday low of ₹724.35, marking a steep decline.

Q3 Performance: Profit Halves, Revenue Stagnant

Jindal Steel and Power (JSPL) net profit for the December 2024 quarter fell sharply to ₹950.88 crore, down by more than 50% compared to ₹1,927.99 crore in the same quarter last year.

While steel sales grew 5% YoY, reaching 1.90 million tonnes (MT) compared to 1.81 MT in the previous year, overall volume growth remained weak. Adding to the pressure, steel prices in India failed to provide much support to producers, leading to flat revenue growth. JSPL’s revenue from operations for the quarter came in at ₹11,750.67 crore, marginally higher than ₹11,701.32 crore in Q3 FY24.

What Analysts Say

Motilal Oswal Financial Services (MOFSL) pointed out that JSPL’s Q3 performance was impacted by weaker-than-expected volumes and subdued price realizations. The brokerage noted that steel sales volumes (1.9 MT) fell short of their estimate of 2.18 MT, contributing to the disappointing results.

However, MOFSL remains optimistic about earnings improving in the coming quarters, citing higher volumes and cost reductions as key factors that could drive growth.

Revised Estimates & Stock Rating

Given the lower-than-expected volume growth outlook, MOFSL has revised down its EBITDA estimates for Jindal Steel and Power by:

  • 6% for FY25
  • 17% for FY26
  • 10% for FY27

The firm is also waiting for more clarity on JSPL’s new capex plans before making a further assessment of earnings implications.

Despite the disappointing Q3 numbers, MOFSL has maintained a ‘BUY’ rating on the stock, though it has lowered the target price to ₹960.

What Lies Ahead for JSPL?

While the Q3 results have triggered a sharp market reaction, analysts believe that long-term growth drivers remain intact. The focus will now be on whether volume expansion and cost optimization strategies can help JSPL recover lost ground in the coming quarters.

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