JSW Steel loses shine

JSW Steel announced its earnings for Q3FY23 post market hours on Friday and the market beat it down as the numbers were much below expectations. Not surprisingly, the stock is today among the top five losers on the BSE, going down over 6% to an intraday low at Rs.246 and currently trades around the same levels.

Its consolidated net profit fell 45% (YoY) to Rs.180 crore while its total revenue rose 18% at Rs.2350 crore due to higher realisation (as higher fuel costs are passed through in nature for LT PPAs (long term power purchase agreements). Its EBITDA for the quarter was 18% lower at Rs 727 crore primarily due to lower short-term sales YoY, partly offset by the contribution from Vijayanagar Solar and higher other income in the quarter.  EBITDA margin contracted to 28% from 42% (YoY).

The company has an operational installed power generation capacity of 4.8 GW which it targets to increase to 10 GW by 2025 with 61% of renewable energy (RE) share from the current levels of 34%.

The company stated that the transaction of acquiring Mytrah RE asset portfolio of 422 MW solar and 1,331 MW wind is expected to achieve closure by Q4 FY23.

It also mentioned that it has completed the acquisition of 700 MW thermal assets of Ind-Barath, which are expected to be commissioned within 24 months.