Table of Contents
Company Overview of JSW Steel Ltd
JSW Steel Limited is a holding company based in India that focuses on the manufacturing and sale of iron and steel products. It operates integrated manufacturing facilities at Vijayanagar Works in Karnataka, Dolvi Works in Maharashtra and Salem Works in Tamil Nadu, as well as a plate and coil mill division in Anjar, Gujarat.
The company produces a wide range of steel products, including hot rolled coils, cold rolled coils, galvanized and galvalume products, tinplate, electrical steel, TMT bars, wire rods, rails, grinding balls and special steel bars.
Company Overview of Jindal Steel Ltd
Jindal Steel and Power Limited, an India-based steel producer, operates in three main segments: Iron and steel products, Power and Others. The Iron and steel products segment involves the manufacturing of various steel products including sponge iron, pellets and castings.
The power segment focuses on power generation activities, while the other segments include aviation, machinery division and real estate operations. Additionally, the company is involved in iron ore mining and the manufacturing of cement, lime, plaster, basic iron and structural metal products. It also produces steam generators other than central heating hot water boilers.
The Stock performance of JSW Steel
The table below displays the month-by-month stock performance of JSW Steel Ltd for the past year.
Month | Return (%) |
Dec-2023 | 9.35 |
Jan-2024 | -7.0 |
Feb-2024 | -2.66 |
Mar-2024 | 3.23 |
Apr-2024 | 5.27 |
May-2024 | -0.28 |
Jun-2024 | 2.14 |
Jul-2024 | -0.72 |
Aug-2024 | 0.38 |
Sep-2024 | 9.45 |
Oct-2024 | -6.35 |
Nov-2024 | -0.4 |
The Stock performance of Jindal Steel
The table below displays the month-by-month stock performance of Jindal Steel And Power Ltd. for the past year.
Month | Return (%) |
Dec-2023 | 10.34 |
Jan-2024 | 0.68 |
Feb-2024 | 1.24 |
Mar-2024 | 8.8 |
Apr-2024 | 8.35 |
May-2024 | 10.08 |
Jun-2024 | -3.3 |
Jul-2024 | -5.43 |
Aug-2024 | -2.57 |
Sep-2024 | 6.63 |
Oct-2024 | -12.33 |
Nov-2024 | -2.31 |
Fundamental Analysis of JSW Steel
JSW Steel Ltd is a leading player in India’s steel industry, recognized for its innovative approach and commitment to sustainability. JSW Steel focuses on leveraging advanced technology and efficient processes to enhance productivity and reduce environmental impact. With a strong emphasis on corporate social responsibility, JSW Steel engages in various community development initiatives.
The stock is priced at ₹925.95 with a market capitalization of ₹2,25,892.57 crore and a dividend yield of 0.96%. It has delivered a 5-year CAGR of 28.46% and a 5-year average net profit margin of 7.33%, currently 14.80% below its 52-week high.
- Close Price ( ₹ ): 925.95
- Market Cap ( Cr ): 225892.57
- Dividend Yield %: 0.96
- Book Value (₹): 79812.00
- 1Y Return %: 9.94
- 6M Return %: -0.40
- 1M Return %: -1.39
- 5Y CAGR %: 28.46
- % Away From 52W High: 14.80
- 5Y Avg Net Profit Margin %: 7.33
Fundamental Analysis of Jindal Steel & Power
Jindal Steel and Power Limited (JSPL) is a prominent player in the steel, power and mining sectors in India. Founded by Naveen Jindal, the company has established itself as one of the leading integrated steel producers in the country.
The stock trades at ₹922.40 with a market capitalization of ₹93,326.53 crore and a dividend yield of 0.21%. It achieved a strong 5-year CAGR of 42.49% and a 1-year return of 32.23%, currently 18.93% below its 52-week high.
- Close Price ( ₹ ): 922.40
- Market Cap ( Cr ): 93326.53
- Dividend Yield %: 0.21
- Book Value (₹): 44750.65
- 1Y Return %: 32.23
- 6M Return %: -12.68
- 1M Return %: 7.15
- 5Y CAGR %: 42.49
- % Away From 52W High: 18.93
- 5Y Avg Net Profit Margin %: 7.78
Financial Comparison of JSW Steel and Jindal Steel
The table below shows a financial comparison of JSW Steel Ltd and Jindal Steel Ltd.
Stock | JSW Steel Ltd | Jindal Steel Ltd | ||||
Financial type | FY 2023 | FY 2024 | TTM | FY 2023 | FY 2024 | TTM |
Total Revenue (₹ Cr) | 167581.0 | 176599.0 | 171589.00 | 54049.45 | 50511.05 | 50158.50 |
EBITDA (₹ Cr) | 20031.0 | 29657.0 | 24474.00 | 9403.21 | 10357.25 | 10465.69 |
PBIT (₹ Cr) | 12557.0 | 21485.0 | 15745.00 | 6712.26 | 7535.5 | 7456.24 |
PBT (₹ Cr) | 5655.0 | 13380.0 | 7484.00 | 5266.37 | 6241.27 | 6162.79 |
Net Income (₹ Cr) | 4144.0 | 8812.0 | 4998.00 | 3173.94 | 5938.42 | 5064.74 |
EPS (₹) | 13.73 | 29.02 | 16.37 | 31.49 | 59.17 | 50.53 |
DPS (₹) | 3.4 | 7.3 | 7.30 | 2.0 | 2.0 | 2.00 |
Payout ratio (%) | 0.25 | 0.25 | 0.45 | 0.06 | 0.03 | 0.04 |
Points to be noted:
- EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization): Measures a company’s profitability before accounting for financial and non-cash expenses.
- PBIT (Profit Before Interest and Tax): Reflects operating profit by excluding interest and taxes from total revenue.
- PBT (Profit Before Tax): Indicates profit after deducting operating costs and interest but before taxes.
- Net Income: Represents the company’s total profit after all expenses, including taxes and interest, are deducted.
- EPS (Earnings Per Share): Shows the portion of a company’s profit allocated to each outstanding share of stock.
- DPS (Dividend Per Share): Reflects the total dividend paid out per share over a specific period.
- Payout Ratio: Measures the proportion of earnings distributed as dividends to shareholders.
Dividend of JSW Steel and Jindal Steel & Power Ltd
The table below shows a dividend paid by the company.
Jindal Steel | Jsw Steel | ||||||
Announcement Date | Ex-Dividend Date | Dividend Type | Dividend (Rs) | Announcement Date | Ex-Dividend Date | Dividend Type | Dividend (Rs) |
13 May, 2024 | 22 August, 2024 | Final | 2 | 21 May, 2024 | 09 Jul, 2024 | Final | 7.3 |
16 May, 2023 | 18 August, 2023 | Final | 2 | 22 May, 2023 | 11 Jul, 2023 | Final | 3.4 |
8 Sep, 2022 | 20 Sep, 2022 | Final | 2 | 27 May, 2022 | 4 Jul, 2022 | Final | 17.35 |
7 Mar, 2022 | 16 Mar, 2022 | Interim | 1 | 21 May, 2021 | 5 Jul, 2021 | Final | 6.5 |
29 Apr, 2014 | 11 Jul, 2014 | Final | 1.5 | 22 May, 2020 | 6 Jul, 2020 | Final | 2 |
25 Apr, 2013 | 13 September, 2013 | Final | 1.6 | 24 May, 2019 | 8 Jul, 2019 | Final | 4.1 |
27 Apr, 2012 | 10 Sep, 2012 | Final | 1.6 | 16 May, 2018 | 06 Jul, 2018 | Final | 3.2 |
21 Apr, 2011 | 12 September, 2011 | Final | 1.5 | 18 May, 2017 | 12 Jun, 2017 | Final | 2.25 |
4 May, 2010 | 13 Sep, 2010 | Final | 1.25 | 18 May, 2016 | 04 Jul, 2016 | Final | 7.5 |
27 May, 2009 | 14 Sep, 2009 | Final | 5.5 | 15 May, 2015 | 6 July, 2015 | Final | 11 |
Advantages and Disadvantages of Investing in JSW Steel Ltd
JSW Steel Ltd
The primary advantage of JSW Steel Ltd lies in its position as a leading integrated steel producer in India, benefiting from a robust supply chain, advanced manufacturing technologies and a strong focus on innovation and sustainability.
- Strong Market Presence: JSW Steel holds a significant share of India’s steel market, supported by extensive manufacturing facilities and a diverse product portfolio catering to domestic and international demand.
- Technological Excellence: The company leverages cutting-edge technology in its production processes, enhancing efficiency, reducing costs and delivering high-quality steel products to maintain a competitive edge in the global market.
- Integrated Operations: JSW Steel’s vertically integrated operations, from raw material sourcing to finished products, ensure cost efficiency, operational control and consistency in quality, strengthening its market position.
- Focus on Sustainability: With an emphasis on reducing carbon emissions and adopting green steel initiatives, JSW Steel aligns with global environmental standards, attracting eco-conscious investors and customers.
- Global Expansion: The company’s strategic acquisitions and international ventures enhance its global footprint, diversifying revenue streams and reducing dependence on domestic markets, thereby mitigating risks and fostering growth.
The main disadvantage of JSW Steel Ltd is its exposure to fluctuating raw material costs and global steel price volatility, which can significantly impact profitability and operational stability in a highly competitive and cyclical industry.
- Dependence on Raw Material Imports: The company relies heavily on imported iron ore and coking coal, making it vulnerable to supply chain disruptions and global price fluctuations that can increase production costs and reduce profit margins.
- Environmental Challenges: As a large-scale steel producer, JSW Steel faces scrutiny over carbon emissions and environmental impact, requiring substantial investments in sustainability measures to meet regulatory standards and stakeholder expectations.
- High Debt Levels: The company’s growth and expansion efforts have led to significant debt, which poses financial risks, particularly during periods of economic downturn or when steel demand weakens globally.
- Market Competition: Intense competition in the steel sector, both domestically and internationally, exerts pricing pressure, forcing JSW Steel to continuously innovate and maintain operational efficiency to sustain profitability.
- Cyclical Nature of Industry: The steel industry’s cyclical nature, driven by economic and construction sector trends, exposes JSW Steel to revenue fluctuations, impacting its ability to plan long-term strategies and maintain consistent growth.
Advantages and Disadvantages of Investing in Jindal Steel
Jindal Steel And Power Ltd
The primary advantage of Jindal Steel and Power Ltd (JSPL) lies in its diversified portfolio of steel and power operations, supported by efficient manufacturing processes, robust infrastructure and a strong presence in both domestic and global markets.
- Integrated Operations: JSPL’s vertical integration, spanning steel production to power generation, ensures cost efficiency, operational control and consistent quality, making it a resilient and competitive player in the market.
- Focus on Innovation: The company emphasizes technological advancements in steel production, adopting modern techniques that improve product quality and reduce costs, enabling it to cater to evolving customer demands effectively.
- Sustainability Initiatives: JSPL prioritizes sustainability through energy-efficient production methods and renewable energy adoption, aligning with global environmental standards and appealing to eco-conscious stakeholders.
- Strong Domestic Presence: With extensive operations in India, JSPL benefits from robust infrastructure, catering to growing demand in key sectors like construction, automotive and infrastructure development.
- Global Expansion: The company’s strategic focus on exports and international markets diversifies its revenue streams, reduces dependency on domestic markets and enhances its global competitiveness in the steel and power industries.
The main disadvantage of Jindal Steel and Power Ltd (JSPL) is its exposure to market volatility in steel and power prices, along with significant debt levels, which can impact financial stability and long-term growth prospects.
- High Debt Burden: JSPL’s substantial debt from expansion efforts poses financial risks, especially during economic downturns, affecting its ability to invest in new projects or withstand market fluctuations.
- Raw Material Dependence: Heavy reliance on external sources for raw materials like iron ore and coal makes the company vulnerable to price volatility and supply chain disruptions, increasing production costs and impacting profitability.
- Environmental Concerns: Operating in energy-intensive industries, JSPL faces challenges related to carbon emissions and environmental compliance, requiring continuous investment in sustainable practices to meet regulatory standards and stakeholder expectations.
- Cyclical Industry: The steel and power sectors’ cyclical nature exposes JSPL to revenue fluctuations, making it challenging to maintain consistent growth during periods of low demand or economic slowdown.
- Intense Competition: Strong competition in domestic and global markets exerts pricing pressure, forcing JSPL to maintain operational efficiency and innovate to sustain profitability while facing challenges from established and emerging players.
How to Invest in JSW Steel and Jindal Steel & Power Ltd Stocks?
Investing in JSW Steel and Jindal Steel & Power Ltd stocks requires understanding the steel sector’s dynamics, analyzing market trends and selecting a reliable stockbroker like Alice Blue to ensure seamless trading and effective portfolio management.
- Research the Sector: Analyze the steel industry’s market trends, demand drivers and challenges. Study the financial health, growth potential and competitive positioning of JSW Steel and Jindal Steel & Power Ltd to make informed investment decisions.
- Open a Trading Account: Use a trusted broker like Alice Blue to open a Demat and trading account. Alice Blue provides advanced tools, a user-friendly interface and low brokerage rates to facilitate efficient stock trading.
- Evaluate Performance: Examine the companies’ past financial performance, including revenue growth, profitability and debt levels. Review their future expansion plans and ability to adapt to market challenges for a holistic evaluation.
- Strategize Investment: Define your investment goals, risk tolerance and timeline. Diversify your portfolio to balance risks and returns, allocating investments between JSW Steel and Jindal Steel based on individual performance metrics and market conditions.
- Monitor Regularly: Stay updated on steel market developments and global trends. Use platforms like Alice Blue for real-time data and tools to track stock performance and make timely adjustments to your investment strategy.
JSW Steel vs. Jindal Steel – Conclusion
JSW Steel stands out for its strong market presence, technological excellence and focus on sustainability. With integrated operations and a robust global footprint, it caters to diverse markets while maintaining efficiency and aligning with green steel initiatives, appealing to both conservative and growth-oriented investors.
Jindal Steel & Power Ltd excels in its diversified steel and power operations, emphasizing innovation and sustainability. With a strong domestic presence and growing international reach, it offers significant growth potential while addressing challenges like debt and market volatility, making it suitable for risk-tolerant, long-term investors.
Best Steel Sector Stocks – Jindal Steel Vs JSW Steel : FAQs
JSW Steel is one of India’s leading steel manufacturing companies, part of the JSW Group. Established in 1994, it specializes in producing a variety of steel products, catering to diverse sectors such as construction, automotive and infrastructure. The company is known for its advanced technology and sustainable practices.
Jindal Steel and Power Ltd (JSPL) is a leading Indian steel and power company known for its innovative and sustainable practices. It produces high-quality steel products, operates power plants and focuses on infrastructure development, catering to domestic and international markets with a strong emphasis on technological advancements.
Steel stocks represent shares of companies involved in the production, processing, or distribution of steel and related products. These stocks are influenced by industrial demand, construction activity and global economic trends, offering investment opportunities tied to the growth of infrastructure, manufacturing and other steel-intensive industries.
Jayant Acharya serves as the Joint Managing Director and Chief Executive Officer (CEO) of JSW Steel Ltd. With over 37 years in the metals and mining sector, he has been instrumental in the company’s growth and technological advancements.
The main competitors of JSW Steel and Jindal Steel include Tata Steel, Steel Authority of India Limited (SAIL) and ArcelorMittal. These companies are major players in the steel industry, competing on production capacity, technological advancements, market share and sustainability initiatives in both domestic and international markets.
As of December 2024, JSW Steel Ltd has a market capitalization of approximately ₹2.259 trillion, reflecting its substantial presence in the steel industry. In comparison, Jindal Steel & Power Ltd’s market cap is around ₹881.61 billion, indicating its significant but comparatively smaller market valuation. Market capitalization represents the total value of a company’s outstanding shares, serving as a key indicator of its market worth.
JSW Steel focuses on key growth areas such as expanding production capacity, adopting advanced technologies for green steel production and strengthening its global presence through strategic acquisitions. It emphasizes sustainability initiatives, including carbon emission reduction, while catering to increasing demand from the infrastructure, automotive and construction sectors.
Jindal Steel’s key growth areas include expanding its steel production capacity, enhancing power generation capabilities and exploring global markets. The company focuses on technological advancements, sustainability initiatives like green steel and catering to demand from infrastructure, construction and manufacturing sectors to drive long-term growth and competitiveness.
JSW Steel typically offers better dividends compared to Jindal Steel, supported by its stable financial performance, larger market share and consistent profitability. Jindal Steel, focusing on growth and expansion, prioritizes reinvestment over dividends, making JSW Steel a more attractive option for dividend-seeking investors.
For long-term investors, JSW Steel offers stability with its diversified operations, technological advancements and focus on sustainability, appealing to conservative investors. Jindal Steel, with its growth-oriented approach and expansion into power, provides higher potential returns but involves greater risk, making it suitable for risk-tolerant investors.
JSW Steel’s revenue is primarily driven by the construction, automotive and infrastructure sectors, supported by its diversified steel product offerings. Jindal Steel generates significant revenue from the construction and infrastructure sectors, alongside contributions from its power generation and specialized steel products for various industries.
JSW Steel is generally more profitable due to its larger scale, diversified operations and strong market presence, enabling consistent returns. Jindal Steel, with its growth-oriented strategy and focus on power and specialized steel, offers higher growth potential but faces greater profitability variability, appealing to risk-tolerant investors.
Disclaimer: The above article is written for educational purposes and the companies’ data mentioned in the article may change with respect to time. The securities quoted are exemplary and are not recommendatory.