Multibagger metal stock in a bull run, hits record high for fourth session; here’s why
Multibagger stock: Jindal Steel stock gained 1.65% to Rs 1021.95 against the previous close of Rs 1005.30 on BSE. The stock hit record high for the fourth straight session today after the firm announced its Q4 and FY24 earnings on May 13 post market hours.
- May 17, 2024,
- Updated May 17, 2024 10:35 AM IST
Shares of Jindal Steel & Power hit a record high in early deals today amid correction in the broader market. The metal stock has delivered 547.78% returns in five years and clocked 132% returns in three years. Jindal Steel stock gained 1.65% to Rs 1021.95 against the previous close of Rs 1005.30 on BSE. The stock hit record high for the fourth straight session today after the firm announced its Q4 and FY24 earnings on May 13 post market hours. The stock has risen 9% since then. It has been trading above Rs 1000 mark for the second straight session.
Market cap of the firm rose to Rs 1.03 lakh crore. On Friday, Jindal Steel shares saw a turnover of Rs 1.99 crore as 0.20 lakh shares of the firm changed hands on BSE.
The stock has a one-year beta of 0.9, indicating low volatility during the period. However, the stock is overbought charts with a relative strength index (RSI) of Jindal Steel at 71.7. Jindal Steel shares are trading higher than the 10 day, 30 day, 50 day, 100 day, 150 day and 200 day moving averages.
Consolidated net profit zoomed 100.5% in the March 2024 quarter. Profit climbed to Rs 933.5 crore in the last quarter against a profit of Rs 466 crore in the Q4 of FY23. Profit in the reporting quarter was affected by an exceptional loss of Rs 153.5 crore. Revenue from operations fell 1.5 percent on-year to Rs 13,487 crore for the quarter.
Revenue rose 15 percent on a sequential basis and profit fell 52 percent from Rs 1,928 crore reported in Q3FY24.
On a standalone basis, net profit climbed 62 percent to Rs 1281.53 crore. Total revenue from operations rose 4 percent to Rs 13,773.4 crore in Q4 from Rs 13,192.3 crore a yaer earlier.
Post earnings, Nuvama said the stock is likely to see time correction.
"Management cut its sustainable EBITDA/t guidance by Rs 1,000 per tonne to Rs 18–20K/t (FY24: Rs 18,555). Though we see a recovery from Q4FY24, upside to our EBITDA estimate is limited (FY25E/26E EBITDA/t of Rs 19,096/19,960). We feel the current market price factors in part of its expansion growth potential. We would await lower price to enter Jindal Steel."
Motilal Oswal said the stock is likely to rise 16%. It has a buy call on the stock with a targtet of Rs 1090.
"While 4Q EBITDA was marginally lower than our estimate, the outlook remains bright. JSPL increased prices in April 24 and coal costs are expected to be lower in 1QFY25. Capex would transition toward more value-added products, which would yield better profitability. We marginally increase our EBITDA estimates by 4%/3% for FY25/FY26. We maintain our BUY rating on JSPL with a revised price target of Rs 1090, based on 6.5x FY26E EV/EBITDA. The stock is currently trading at 5.7x FY26E EV/EBTIDA and 1.6x FY26E P/B," said Motilal Oswal.
Shares of Jindal Steel & Power hit a record high in early deals today amid correction in the broader market. The metal stock has delivered 547.78% returns in five years and clocked 132% returns in three years. Jindal Steel stock gained 1.65% to Rs 1021.95 against the previous close of Rs 1005.30 on BSE. The stock hit record high for the fourth straight session today after the firm announced its Q4 and FY24 earnings on May 13 post market hours. The stock has risen 9% since then. It has been trading above Rs 1000 mark for the second straight session.
Market cap of the firm rose to Rs 1.03 lakh crore. On Friday, Jindal Steel shares saw a turnover of Rs 1.99 crore as 0.20 lakh shares of the firm changed hands on BSE.
The stock has a one-year beta of 0.9, indicating low volatility during the period. However, the stock is overbought charts with a relative strength index (RSI) of Jindal Steel at 71.7. Jindal Steel shares are trading higher than the 10 day, 30 day, 50 day, 100 day, 150 day and 200 day moving averages.
Consolidated net profit zoomed 100.5% in the March 2024 quarter. Profit climbed to Rs 933.5 crore in the last quarter against a profit of Rs 466 crore in the Q4 of FY23. Profit in the reporting quarter was affected by an exceptional loss of Rs 153.5 crore. Revenue from operations fell 1.5 percent on-year to Rs 13,487 crore for the quarter.
Revenue rose 15 percent on a sequential basis and profit fell 52 percent from Rs 1,928 crore reported in Q3FY24.
On a standalone basis, net profit climbed 62 percent to Rs 1281.53 crore. Total revenue from operations rose 4 percent to Rs 13,773.4 crore in Q4 from Rs 13,192.3 crore a yaer earlier.
Post earnings, Nuvama said the stock is likely to see time correction.
"Management cut its sustainable EBITDA/t guidance by Rs 1,000 per tonne to Rs 18–20K/t (FY24: Rs 18,555). Though we see a recovery from Q4FY24, upside to our EBITDA estimate is limited (FY25E/26E EBITDA/t of Rs 19,096/19,960). We feel the current market price factors in part of its expansion growth potential. We would await lower price to enter Jindal Steel."
Motilal Oswal said the stock is likely to rise 16%. It has a buy call on the stock with a targtet of Rs 1090.
"While 4Q EBITDA was marginally lower than our estimate, the outlook remains bright. JSPL increased prices in April 24 and coal costs are expected to be lower in 1QFY25. Capex would transition toward more value-added products, which would yield better profitability. We marginally increase our EBITDA estimates by 4%/3% for FY25/FY26. We maintain our BUY rating on JSPL with a revised price target of Rs 1090, based on 6.5x FY26E EV/EBITDA. The stock is currently trading at 5.7x FY26E EV/EBTIDA and 1.6x FY26E P/B," said Motilal Oswal.