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Last Updated on: 15 October, 2024
Author: Getaka|Social: Getaka Financial Services X (Earlier Twitter) Profile Getaka Financial Services LinkedIn Logo
Stock Ticker - BSE: 500228 | NSE: JSWSTEEL

JSW Steel Ltd: Intrinsic Value and Fundamental Analysis

Share Price and Basic Stock Data

Last Updated: October 15, 2024, 11:18 pm

Market Cap 2,44,729 Cr.
Current Price 1,001
High / Low1,063/723
Stock P/E35.1
Book Value 318
Dividend Yield0.73 %
ROCE13.3 %
ROE11.8 %
Face Value 1.00
PEG Ratio1.56

Stock P/E, Current Price, and Intrinsic Value Over Time

View Share Price Target for JSW Steel Ltd

Competitors of JSW Steel Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
Eastcoast Steel Ltd 11.7 Cr. 21.735.1/17.723.0 35.90.00 %3.78 %4.64 % 10.0
Bonlon Industries Ltd 51.2 Cr. 36.156.0/29.520.0 55.70.00 %4.56 %2.99 % 10.0
Beekay Steel Industries Ltd 1,282 Cr. 672845/54910.3 4940.15 %10.7 %11.2 % 10.0
Ecofinity Atomix Ltd 21.5 Cr. 55.969.7/30.638.4 8.540.00 %8.85 %8.56 % 10.0
Aerpace Industries Ltd 758 Cr. 50.752.8/2.56 0.940.00 %12.7 %15.8 % 1.00
Industry Average44,459.25 Cr384.5373.50148.080.35%8.72%9.46%7.35

All Competitor Stocks of JSW Steel Ltd

Quarterly Result

MonthDec 2020Mar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023
Sales21,85926,93428,90232,50338,07146,89538,08641,77839,13446,96242,21344,58441,940
Expenses15,91818,49418,62822,08628,93937,74233,79440,08234,64339,03135,20136,72234,776
Operating Profit5,9418,44010,27410,4179,1329,1534,2921,6964,4917,9317,0127,8627,164
OPM %27%31%36%32%24%20%11%4%11%17%17%18%17%
Other Income147905211,549176-508189779188465331826194
Interest9771,0059939361,2831,7561,4221,5231,8192,1381,9632,0841,996
Depreciation1,2301,2531,1831,2391,7641,8151,7781,8051,8822,0091,9002,0192,059
Profit before tax3,8816,2728,6199,7916,2615,0741,281-8539784,2493,4804,5853,303
Tax %31%33%32%27%28%34%34%-7%52%12%30%40%26%
Net Profit2,6694,1915,9007,1794,5163,343839-9154743,7412,4282,7732,450
EPS in Rs11.0917.3724.4229.6618.0213.383.47-3.512.0315.169.6711.299.88

Last Updated: Unknown

Quarterly Chart

Profit & Loss - Annual Report

Last Updated: Unknown

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023TTM
Sales34,36838,21051,22052,97241,54655,60471,93384,75773,32679,839146,371165,960175,699
Expenses27,57131,69842,05143,60835,12443,29657,01765,82761,51359,661107,257147,490145,730
Operating Profit6,7976,5129,1699,3646,42212,30814,91618,93011,81320,17839,11418,47029,969
OPM %20%17%18%18%15%22%21%22%16%25%27%11%17%
Other Income-1,444-307-1,630103-1,96618-177196-2894731,6001,5611,816
Interest1,4271,9673,0483,4933,6013,7683,7013,9174,2653,9574,9686,9028,181
Depreciation1,9332,2373,1833,4343,3233,4303,3874,0414,2464,6796,0017,4747,987
Profit before tax1,9931,9991,3082,539-2,4685,1287,65111,1683,01312,01529,7455,65515,617
Tax %25%42%70%32%80%33%20%33%-30%34%30%27%
Net Profit5579294021,722-4813,4676,1137,5243,9197,87320,9384,13911,392
EPS in Rs2.414.321.877.43-1.3914.5725.7131.6016.6732.7385.4917.1446.00
Dividend Payout %40%30%74%19%-67%19%16%16%15%25%25%25%

Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2012-20132013-20142014-20152015-20162016-20172017-20182018-20192019-20202020-20212021-20222022-2023
YoY Net Profit Growth (%)66.79%-56.73%328.36%-127.93%820.79%76.32%23.08%-47.91%100.89%165.95%-80.23%
Change in YoY Net Profit Growth (%)0.00%-123.51%385.09%-456.29%948.72%-744.47%-53.24%-71.00%148.81%65.05%-246.18%

JSW Steel Ltd has shown an inconsistent trend in YoY Net Profit Growth (%) in the last 11 years from 2012-2013 to 2022-2023.

Growth

Compounded Sales Growth
10 Years:13%
5 Years:16%
3 Years:30%
TTM:3%
Compounded Profit Growth
10 Years:38%
5 Years:2%
3 Years:2%
TTM:36%
Stock Price CAGR
10 Years:24%
5 Years:35%
3 Years:13%
1 Year:27%
Return on Equity
10 Years:17%
5 Years:17%
3 Years:17%
Last Year:12%

Last Updated: Unknown

Balance Sheet

Last Updated: Unknown

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Equity Capital284303303301301302301301302301301305
Reserves16,78120,87121,98718,66522,34627,69634,49436,29846,46266,99665,39477,364
Borrowings21,62535,52738,75442,20443,33439,39347,39661,42362,39272,23780,85387,984
Other Liabilities18,82320,93924,61020,73722,02424,57932,60633,79839,16156,95163,99162,245
Total Liabilities57,51377,64085,65481,90788,00591,970114,797131,820148,317196,485210,539227,898
Fixed Assets34,71747,04652,17656,14058,73057,84862,64462,08564,91799,880104,452112,461
CWIP5,8989,4008,2657,2714,3635,95011,88927,19132,56616,90522,16629,676
Investments1,7506635991,1951,3661,4691,8941,2598,5814,9404,8067,246
Other Assets15,14820,53124,61317,30223,54626,70338,37041,28542,25374,76079,11578,515
Total Assets57,51377,64085,65481,90788,00591,970114,797131,820148,317196,485210,539227,898

Reserves and Borrowings Chart

Cash Flow

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Cash from Operating Activity 5,8442,5947,8766,8977,88812,37914,63312,78518,78926,27023,32312,078
Cash from Investing Activity -5,433-5,618-7,372-3,857-5,094-4,529-11,387-19,589-7,702-14,748-10,730-14,467
Cash from Financing Activity -7913,300-169-3,151-2,710-8,1851,7535,189-3,110-14,657-5,977-5,005
Net Cash Flow-380276334-11184-3354,999-1,6157,977-3,1356,616-7,394

Free Cash Flow

MonthMar 2012Mar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023
Free Cash Flow6.00-15.00-26.00-29.00-36.00-31.00-25.00-29.00-50.00-42.00-33.00-62.00

Free Cash Flow = Income Generated from Operational Activities - Borrowings - Capital Work in Progress (CWIP)

Consistent positive free cash flow is crucial for businesses as it indicates their ability to generate cash from their core operations. It provides financial flexibility, allowing companies to invest in growth opportunities, pay dividends to shareholders, reduce debt, and weather economic downturns more effectively.

Free Cash Flow Chart

Financial Efficiency Indicators

MonthMar 2013Mar 2014Mar 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Debtor Days201617242724312221191616
Inventory Days8398136135147118123130160208130151
Days Payable155141175207172149137169171190149133
Cash Conversion Cycle-52-26-23-482-717-17936-433
Working Capital Days-66-44-49-84-34-25-36-53-828-1210
ROCE %11%13%10%5%14%18%20%9%16%29%8%13%

Financial Efficiency Indicators Chart

Share Holding Pattern

MonthSep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023Dec 2023Mar 2024Jun 2024
Promoters44.09%44.72%45.01%45.02%45.20%45.20%45.41%45.41%44.79%44.81%44.81%44.81%
FIIs12.17%11.21%11.58%10.61%10.75%26.04%26.01%25.98%26.13%26.33%26.06%25.52%
DIIs8.06%8.38%7.94%9.07%9.25%9.34%9.47%9.59%9.50%9.48%9.81%10.52%
Government0.51%0.51%0.51%0.51%0.51%0.51%0.51%0.51%0.51%0.51%0.51%0.51%
Public34.80%34.85%34.65%34.14%33.70%18.35%18.07%17.99%18.64%18.47%18.44%18.30%
Others0.37%0.33%0.31%0.65%0.60%0.57%0.53%0.51%0.43%0.41%0.37%0.34%
No. of Shareholders6,86,7246,79,9066,59,8796,94,9166,67,1736,08,4486,05,0195,86,9976,63,1796,41,5826,71,7796,35,680

Shareholding Pattern Chart

No. of Shareholders

Mutual Fund Holdings

Fund NameNo of SharesAUM (%)Amount Invested (Cr)Previous Number of SharesPrevious DatePercentage Change
SBI Nifty 50 ETF17,268,0970.821413.652,737,4832024-10-13530.8%
SBI S&P BSE Sensex ETF12,214,3900.95999.692,737,4832024-10-13346.19%
UTI Nifty 50 ETF4,781,8940.82391.472,737,4832024-10-1374.68%
UTI S&P BSE Sensex ETF4,213,0910.95344.822,737,4832024-10-1353.9%
ICICI Prudential Equity & Debt Fund2,737,4830.72224.12,737,4832024-10-130%
Nippon India ETF Nifty 50 BeES2,039,0450.82166.932,737,4832024-10-13-25.51%
ICICI Prudential Commodities Fund2,001,8638.28163.882,737,4832024-10-13-26.87%
UTI Nifty 50 Index Fund1,536,1090.82125.752,737,4832024-10-13-43.89%
SBI Arbitrage Opportunities Fund1,490,4000.46122.012,737,4832024-10-13-45.56%
HDFC Index Nifty 50 Plan - Regular Plan1,224,6340.82100.252,737,4832024-10-13-55.26%

ROCE Trend

EPS Trend

Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue1.001.001.001.001.00
Basic EPS (Rs.)36.3417.2585.9632.9116.78
Diluted EPS (Rs.)36.1717.1485.4932.7316.67
Cash EPS (Rs.)56.7839.0486.4541.5627.43
Book Value[Excl.RevalReserv]/Share (Rs.)261.56222.72227.69152.80119.68
Book Value[Incl.RevalReserv]/Share (Rs.)261.56222.72227.69152.80119.68
Revenue From Operations / Share (Rs.)573.79551.36486.28264.37243.61
PBDIT / Share (Rs.)95.8765.04134.6868.6541.26
PBIT / Share (Rs.)69.0840.21114.7453.1627.15
PBT / Share (Rs.)44.4319.2495.7739.7810.31
Net Profit / Share (Rs.)29.9814.2166.5126.0713.32
NP After MI And SOA / Share (Rs.)28.8913.7768.6526.2013.39
PBDIT Margin (%)16.7011.7927.6925.9616.93
PBIT Margin (%)12.037.2923.5920.1011.14
PBT Margin (%)7.743.4819.6915.044.23
Net Profit Margin (%)5.222.5713.679.855.46
NP After MI And SOA Margin (%)5.032.4914.119.905.49
Return on Networth / Equity (%)11.346.3030.7016.9111.01
Return on Capital Employeed (%)12.998.5724.8515.289.27
Return On Assets (%)3.861.9610.515.333.05
Long Term Debt / Equity (X)0.860.940.861.061.22
Total Debt / Equity (X)1.101.201.041.111.45
Asset Turnover Ratio (%)0.790.710.760.530.54
Current Ratio (X)0.970.971.140.820.83
Quick Ratio (X)0.400.500.540.490.51
Inventory Turnover Ratio (X)2.642.832.922.352.74
Dividend Payout Ratio (NP) (%)0.00101.207.606.1029.65
Dividend Payout Ratio (CP) (%)0.0036.095.893.8314.43
Earning Retention Ratio (%)0.00-1.2092.4093.9070.35
Cash Earning Retention Ratio (%)0.0063.9194.1196.1785.57
Interest Coverage Ratio (X)3.612.848.165.242.91
Interest Coverage Ratio (Post Tax) (X)2.061.535.183.012.13
Enterprise Value (Cr.)278636.82266575.05274342.60179588.7084501.45
EV / Net Operating Revenue (X)1.881.611.872.251.15
EV / EBITDA (X)11.2513.626.778.666.80
MarketCap / Net Operating Revenue (X)1.451.251.511.770.60
Retention Ratios (%)0.00-1.2092.3993.8970.34
Price / BV (X)3.263.153.283.021.20
Price / Net Operating Revenue (X)1.451.251.511.770.60
EarningsYield0.030.020.090.050.09

Profitability Ratios (%)

Liquidity Ratios

Liquidity Ratios (%)

Interest Coverage Ratios (%)

Valuation Ratios

Fair Value

Fair Value of JSW Steel Ltd as of October 15, 2024 is: ₹1,326.71

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators.

As of October 15, 2024, JSW Steel Ltd is Undervalued by 32.54% compared to the current share price ₹1,001.00

Intrinsic Value of JSW Steel Ltd as of October 15, 2024 is: ₹1,625.33

Calculation basis:

  • Intrinsic value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100) * (1 + EPS CAGR for Last 5 Years)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.
  • EPS CAGR (Compound Annual Growth Rate): Represents the geometric mean growth rate of earnings per share over the last 5 years. It provides insight into the historical growth trajectory of the company's earnings.

This formula allows us to gauge the intrinsic value of the stock by analyzing its fundamental indicators along with EPS growth.

As of October 15, 2024, JSW Steel Ltd is Undervalued by 62.37% compared to the current share price ₹1,001.00

Last 5 Year EPS CAGR: 22.51%

*Investments are subject to market risks

Strength and Weakness

StrengthWeakness
  1. The stock has a low average Working Capital Days of -38.92, which is a positive sign.
  2. The stock has a low average Cash Conversion Cycle of -6.67, which is a positive sign.
  3. The company has shown consistent growth in sales (81.85 cr) and profit (6.92 cr) over the years.
  1. The stock has a low average ROCE of 13.83%, which may not be favorable.
  2. The company has higher borrowings (52,760.17) compared to reserves (37,946.17), which may suggest financial risk.

Stock Analysis

  • Considering all of the following key financial indicators, prospective investors are encouraged to conduct thorough research and seek professional guidance before considering any investment in JSW Steel Ltd:
    1. Net Profit Margin: 5.22%
      • Net Profit Margin: This metric indicates the percentage of profit a company makes from its total revenue. A higher net profit margin is generally desirable as it reflects better profitability.
    2. ROCE: 12.99% (Industry Average ROCE: 8.72%)
      • ROCE (Return on Capital Employed): ROCE measures a company's profitability and the efficiency with which its capital is employed. A higher ROCE indicates efficient use of capital.
    3. ROE%: 11.34% (Industry Average ROE: 8.9%)
      • ROE (Return on Equity): ROE measures a company's profitability relative to shareholders' equity. A higher ROE indicates efficient use of shareholders' funds.
    4. Interest Coverage Ratio (Post Tax): 2.06
      • Interest Coverage Ratio: The interest coverage ratio measures a company's ability to cover its interest payments on outstanding debt. A ratio greater than 2 is generally considered healthy as it indicates the company can meet its interest obligations comfortably.
    5. Quick Ratio: 0.4
      • Quick Ratio: The quick ratio assesses a company's ability to cover its short-term liabilities with its most liquid assets. A ratio higher than 1 suggests the company can meet its short-term obligations without relying heavily on inventory.
    6. Stock P/E: 35.1 (Industry average Stock P/E: 60.53)
      • Stock P/E (Price-to-Earnings) Ratio: The P/E ratio compares a company's current share price to its earnings per share. A lower P/E ratio relative to industry peers or historical values may indicate that the stock is undervalued.
    7. Total Debt / Equity: 1.1
      • Total Debt / Equity: This ratio measures a company's financial leverage by comparing its total debt to its total equity. A lower ratio indicates lower financial risk and greater financial stability.
    The current analysis is available for review. It's important to conduct thorough research and consider consulting with financial professionals before making any investment decisions.
    Stock Rating:

About the Company - Qualitative Analysis

JSW Steel Ltd. is a Public Limited Listed company incorporated on 15/03/1994 and has its registered office in the State of Maharashtra, India. Company’s Corporate Identification Number(CIN) is L27102MH1994PLC152925 and registration number is 152925. Currently Company is involved in the business activities of Casting of metals. Company’s Total Operating Revenue is Rs. 118820.00 Cr. and Equity Capital is Rs. 301.00 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
SteelJSW Centre, Mumbai Maharashtra 400051jswsl.investor@jsw.in
http://www.jsw.in
Management
NamePosition Held
Mrs. Savitri Devi JindalChairperson Emeritus
Mr. Sajjan JindalChairman & Managing Director
Mr. Jayant AcharyaJoint Managing Director & CEO
Mr. Gajraj Singh RathoreWhole Time Director & COO
Mr. Seturaman MahalingamInd. Non-Executive Director
Mr. Haigreve KhaitanInd. Non-Executive Director
Mrs. Nirupama RaoInd. Non-Executive Director
Mr. Marcel FasswaldInd. Non-Executive Director
Ms. Fiona Jane Mary PaulusInd. Non-Executive Director
Mr. Hiroyuki OgawaNominee Director
Dr. B C SateeshaNominee Director

FAQ

What is the latest fair value of JSW Steel Ltd?

The latest fair value of JSW Steel Ltd is ₹1326.71.

What is the Market Cap of JSW Steel Ltd?

The Market Cap of JSW Steel Ltd is 2,44,729 Cr..

What is the current Stock Price of JSW Steel Ltd as on 15 October 2024?

The current stock price of JSW Steel Ltd as on 15 October 2024 is ₹1,001.

What is the High / Low of JSW Steel Ltd stocks in FY 2024?

In FY 2024, the High / Low of JSW Steel Ltd stocks is 1,063/723.

What is the Stock P/E of JSW Steel Ltd?

The Stock P/E of JSW Steel Ltd is 35.1.

What is the Book Value of JSW Steel Ltd?

The Book Value of JSW Steel Ltd is 318.

What is the Dividend Yield of JSW Steel Ltd?

The Dividend Yield of JSW Steel Ltd is 0.73 %.

What is the ROCE of JSW Steel Ltd?

The ROCE of JSW Steel Ltd is 13.3 %.

What is the ROE of JSW Steel Ltd?

The ROE of JSW Steel Ltd is 11.8 %.

What is the Face Value of JSW Steel Ltd?

The Face Value of JSW Steel Ltd is 1.00.

About the Author

Author Avatar
Getaka

Getaka, CFA, a financial analyst with 15 years of experience in the industry. Getaka holds an MBA degree and the Chartered Financial Analyst designation, demonstrating his profound understanding of financial analysis and investment management. Throughout his career, he has conducted numerous financial analyses and due diligence processes for companies in the industry, and has a strong track record of identifying key trends and opportunities. He leverages his expertise to deliver a thorough financial analysis of a company, encompassing its financial performance, key ratios, future prospects, and risks. Getaka is committed to providing accurate, reliable, and trustworthy information to help readers make informed decisions about their finances and investments.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. The author is not a SEBI registered financial advisor and does not have any vested interest in JSW Steel Ltd. Investors are advised to conduct their own due diligence and consult with a financial professional before making any investment decisions. The information provided in this article is based on publicly available data and the author's analysis, but it may not be comprehensive or up-to-date. The author and getaka.co.in are not responsible for any errors or omissions in the content. This article is not intended to promote any particular investment strategy or recommendation, and readers should consult with their own financial advisors before making any investment decisions. Data Source: NSE