JSW STEEL 2023-24 Annual Report Analysis

Mon, 8 Jul

JSW STEEL has announced its results for the year ended March 2024. Let us have a look at the detailed performance review of the company during FY23-24.

JSW STEEL Income Statement Analysis

• Operating income during the year rose 5.5% on a year-on-year (YoY) basis.
• The company's operating profit increased by 50.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 16.4% in FY24 as against 11.4% in FY23.
• Depreciation charges increased by 9.3% and finance costs increased by 17.4% YoY, respectively.
• Other income declined by 2.5% YoY.
• Net profit for the year grew by 116.8% YoY.
• Net profit margins during the year grew from 2.5% in FY23 to 5.1% in FY24.

JSW STEEL Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	1,659,600	1,750,060	5.5%
Other income	Rs m	10,300	10,040	-2.5%
Total Revenues	Rs m	1,669,900	1,760,100	5.4%
Gross profit	Rs m	190,010	286,530	50.8%
Depreciation	Rs m	74,740	81,720	9.3%
Interest	Rs m	69,020	81,050	17.4%
Profit before tax	Rs m	56,550	133,800	136.6%
Tax	Rs m	15,160	44,070	190.7%
Profit after tax	Rs m	41,390	89,730	116.8%
Gross profit margin	%	11.4	16.4
Effective tax rate	%	26.8	32.9
Net profit margin	%	2.5	5.1

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JSW STEEL Balance Sheet Analysis

• The company's current liabilities during FY24 down at Rs 661 billion as compared to Rs 700 billion in FY23, thereby witnessing an decrease of -5.6%.
• Long-term debt stood at Rs 674 billion as compared to Rs 620 billion during FY23, a growth of 8.7%.
• Current assets fell 5% and stood at Rs 645 billion, while fixed assets rose 15% and stood at Rs 1,634 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 2,279 billion as against Rs 2,105 billion during FY23, thereby witnessing a growth of 8%.

JSW STEEL Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	652,870	772,230	18.3
Current Liabilities	Rs m	699,630	660,650	-5.6
Long-term Debt	Rs m	619,660	673,540	8.7
Total Liabilities	Rs m	2,105,390	2,278,980	8.2
Current assets	Rs m	681,460	645,330	-5.3
Fixed Assets	Rs m	1,423,890	1,633,640	14.7
Total Assets	Rs m	2,105,390	2,278,980	8.2

JSW STEEL Cash Flow Statement Analysis

• JSW STEEL's cash flow from operating activities (CFO) during FY24 stood at Rs 121 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -146 billion, an improvement of 36.7% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs -50 billion, an improvement of 16% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs -74 billion from the Rs 66 billion net cash flows seen during FY23.

JSW STEEL Cash Flow Statement 2023-24

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-23	Mar-24
Cash Flow from Operating Activities	Rs m	233,230	120,780	-48.2%
Cash Flow from Investing Activities	Rs m	-107,110	-146,380	-
Cash Flow from Financing Activities	Rs m	-59,770	-50,050	-
Net Cash Flow	Rs m	66,160	-73,940	-

Current Valuations for JSW STEEL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 36.8, an improvement from the EPS of Rs 17.2 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 950.8, stands at 25.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.0 times, while the price to sales ratio stands at 1.3 times.
• The company's price to cash flow (P/CF) ratio stood at 11.2 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Sales per share (Unadj.)	Rs	690.2	718.3
TTM Earnings per share	Rs	17.2	36.8
Diluted earnings per share	Rs	16.9	36.7
Price to Cash Flow	x	14.5	11.2
TTM P/E ratio	x	39.3	25.4
Price / Book Value ratio	x	2.4	2.5
Market Cap	Rs m	1,574,914	1,913,751
Dividends per share (Unadj.)	Rs	3.4	7.3

Ratio Analysis for JSW STEEL

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.0x during FY24, from 1.0x during FY23. The current ratio measures the company's ability to pay short-term and long-term obligations.

Interest Coverage Ratio: The company's interest coverage ratio improved and stood at 2.7x during FY24, from 1.8x during FY23. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

• Profitability Ratios

Return on Equity (ROE): The ROE for the company improved and stood at 11.6% during FY24, from 6.3% during FY24. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 14.9% during FY24, from 9.9% during FY23. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

Return on Assets (ROA): The ROA of the company improved and stood at 7.5% during FY24, from 5.2% during FY23. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Current ratio	x	1.0	1.0
Debtors’ Days	Days	2	2
Interest coverage	x	1.8	2.7
Debt to equity ratio	x	0.9	0.9
Return on assets	%	5.2	7.5
Return on equity	%	6.3	11.6
Return on capital employed	%	9.9	14.9

To see how JSW STEEL has performed over the last 5 years, please visit here.

JSW STEEL Share Price Performance

Over the last one year, JSW STEEL share price has moved up from Rs 788.8 to Rs 950.8, registering a gain of Rs 162.1 or around 20.5%.

Meanwhile, the S&P BSE METAL Index is trading at Rs 33,686.9 (down 0.2%). Over the last one year it has moved up from 20,730.0 to 33,686.9, a gain of 12,957 points (up 62.5%).

Overall, the S&P BSE SENSEX is up 22.0% over the year.

(To know more, check out historical annual results for JSW STEEL and quarterly results for JSW STEEL)