ICICI Securities bullish on this multibagger stock, raises target price

Jindal Stainless (JSL) posted better-than-expected EBITDA during the second quarter. “Rising raw material prices (nickel and ferrochrome) helped with inventory valuations and consequently EBITDA,” ICICI Securities Said in a note.

The brokerage has maintained its buy rating on Jindal Stainless stock with a revised target price of ₹250 per share (from ₹230 per share earlier). It has also upgraded its estimates for JSL, posting an excellent H1FY22 print.

The company’s petition for merger with JSHL (Jindal Stainless (Hisar) is pending before NCLT, Chandigarh for approval. According to the brokerage, all the brownfield expansion projects announced in Q1FY22 are on track.

“Significant buildup in working capital and growth capex in H1FY22 did not allow delivering as net debt (excluding debt to group company JSHL). ₹to 15.6 billion ₹14.5 billion QoQ,” the ICICI Securities note said.

All major end-use segments such as Process Industry, Pipes & Tubes, Railways & Wagons, and Metro Rail grew during Q2FY22 keeping the demand for Stainless Steel strong. As general manufacturing picked up pace, demand for specialty grades such as Duplex and Super Austenitic, where JSL is an established supplier, also picked up. “Despite the existing logistical challenges due to container shortage, JSL manages through advance planning and strategic sourcing of raw materials.”

Jindial Stainless (JSL) is a market leader in stainless steel in India with production facilities in Haryana, Odisha and Indonesia. Multibagger stock is up 140% in the last six months, while it is up over 162% so far in 2021 (year-to-date).

The views and recommendations given above are those of individual analysts or broking companies and not of Mint.