Jindal Stainless Limited — Earnings Release 2019

Oct 26, 2018

JSL/BM-3/2018-19

BSE Limited Corporate Relationship Department, 1st Floor, New Trading Ring, Rotunda Building, P J Towers, Dalal Street, Fort, Mumbai - 400 001 Ph. 022 - 2272 3121, 2037, 2041, 3719, 2039, 2272 2061 Email: corp.relations@bseindia.com Security Code No.: 532508

October 26, 2018

National Stock Exchange of India Ltd. Exchange Plaza, 5th Floor, Plot no. C/1, G Block Bandra-Kurla Complex, Bandra (E), Mumbai-400051 Ph. 022 -2659 8237, 8238, 8347, 8348 Email: cmlist@nse.co.in hsurati@nse.co.in Security Code No.: JSL

Sub.: Press Release

Dear Sirs,

We are forwarding herewith copy of Press Release in respect of unaudited standalone financial results of the Company for the quarter and half year ended 30th September, 2018.

Kinly host the same on your website and acknowledge receipt of the same.

Thanking You.

Yours Faithfully, For Jindal Stainless Limited

یم این

(Navneet Raghuvanshi) Company Secretary

Jindal Stainless Limited H1FY19 revenue surges by 35%

		Standalone (in Rs crore)
Particulars	H1 FY18-19	H1 FY17-18	Change
Net Revenue	6,228	4,623	35%
EBIDTA	606	507	20%
PAT	54	69	-21%

H1 FY 19 key highlights

New Delhi, 26th October, 2018: The Board of Directors of Jindal Stainless Limited (JSL) took on record the unaudited financial results of the company here today. The revenue of the company continued to grow both on a quarterly and half-yearly basis, by 18% and 35% over corresponding period last year (CPLY) respectively. The company built up inventory in Q1 to support a planned maintenance shutdown in Q2. This, along with steep hike in nickel prices during Q1, impacted sales of finished inventory in Q2, thereby causing inventory losses. These factors slowed down the overall EBIDTA for Q2FY19. The production volumes for Q2 and H1 FY19 stood at 0.2 MT and 0.46 MT, registering a respective increase of 2% and 22% over CPLY. This was in tune with the company's target to increase its annual capacity from the present level of 0.8 MT to 1.1 MT by the end of FY19.

Commenting on the performance of the quarter, Managing Director, JSL, Abhyuday Jindal, said, "Our Q2 results are a reflection of the cyclical nature of core sector, including its determinants such as input prices and forex volatility. Our focus is to increase annual production by 15% in the next two years to cater to the growing needs of domestic markets. Our product mix is well distributed among different segments, and all of them are showing a healthy growth rate. Besides, we are increasingly moving towards more value added products in railways, automobiles, and other sectors. We are also increasing our presence in the ferretic segment, which will balance the impact of raw material price volatility. This portfolio enhancement, clubbed with gradually growing demand, will help in improved operating performance going forward." Having become eligible to exit from Corporate Debt Restructuring Scheme (CDR), JSL expects to be out of CDR by end of FY19.

The global stainless steel industry remained under pressure due to persisting trade wars and currency volatility. Protectionist measures initiated by US and EU have further necessitated affirmative action by Indian government. The route of Free Trade Agreements (FTAs) continued to be used as a mechanism to circumvent Countervailing Duty and Anti-Dumping Duty imposed by Indian government to safeguard home industries. Steep capacity ramp up by Indonesian mills, driven by Chinese investment, and compounded by zero duty imports from ASEAN countries, poses a serious threat to Indian stainless steel makers. Currently at 3MT per annum, the Indonesian capacity is expected to reach 6MT by 2020, which will further aggravate the situation. The import duty of 2.5% on both stainless steel scrap and ferro-nickel, key raw materials not available in India, continued to affect competency and status of domestic stainless steel players.

	Standalone (in Rs crore)
Particulars	Q2 FY18-19	Q2 FY17-18	Change
Net Revenue	3,081	2,608	18%
EBIDTA	231	256	-10%
PAT	(36)	27	-

Q2 FY 19 key highlights

On a sequential basis, the company registered a marginal dip (-2%) in revenue, from Rs 3,147 crore in Q1FY19 to Rs 3,081 crore in Q2FY19. Exceptional loss of Rs 53 crore, primarily on account on mark-to-market forex loss, resulted in a net loss of Rs 36 crore in Q2FY19. Production volume dipped from 0.26 MT to 0.2 MT as a result of planned maintenance shutdown. In a notable development during the quarter, JSL secured approvals to produce and supply for the elevator segment; the maiden despatch for which was also initiated.