(Reuters) – India’s Jindal SAW, which makes steel pipes for the energy, transportation and water sectors, on Friday reported a lower third-quarter profit on subdued domestic demand amid delayed government projects and slower construction activity.
Consolidated profit after tax dropped 5% to 5.06 billion rupees (about $59 million) in the three months ended Dec. 31.
Revenue from operations fell about 7% to 52.71 billion rupees.
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KEY CONTEXT
The company’s iron and steel pipes sales dropped 2.5% to 432,000 million tonnes in the quarter.
Domestic steel demand remained muted in the quarter due to lower construction activity and delays in projects, analysts said.
The year-ago quarter witnessed robust demand as government spending accelerated ahead of the national general elections, but has cooled off since then.
PEER COMPARISON
Valuation (next 12 Estimates (next 12 Analysts’ sentiment
months) months)
RIC PE EV/EBITDA Revenue Profit Mean No. of Stock to Div
growth growth rating* analyst price yield
s target** (%)
Jindal SAW 8.17 5.66 3.28 5.13 Strong 3 0.57 0.79
Buy
APL Apollo Tubes 39.99 26.14 20.56 53.94 Buy 14 0.90 0.35
Ratnamani Metals 26.22 18.35 19.03 25.93 Buy 4 0.74 0.48
and Tubes
Welspun Corp 17.83 11.24 15.83 17.84 Buy 3 0.98 0.64
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
OCTOBER-DECEMBER STOCK PERFORMANCE
— All data from LSEG IBES
— $1 = 86.1950 Indian rupees
(Reporting by Manvi Pant in Bengaluru; Editing by Eileen Soreng)
