Jindal Stainless Limited

Abhyuday Jindal

MANAGING DIRECTOR, JSL & JSHL

Anurag Mantri

GROUP CHIEF FINANCIAL OFFICER, JSL

Jagmohan Sood

WHOLE-TIME DIRECTOR, JSHL

Ramnik Gupta

CHIEF FINANCIAL OFFICER, JSHL

Goutam Chakraborty

HEAD IR

Shreya Sharma

IR TEAM

Rajesh Majumdar

BATLIVALA & KARANI

15%

stainless steel imports in India and having very different market dynamics, the government imposed 15% export duty on stainless steel also along with carbon steel. The domestic stainless steel indust

50%

rranted stainless steel from China and Indonesia resulted in the share of imports rising to nearly 50%. On the other hand, 70% to 80% of our export product portfolio got impacted due to imposition of 1

70%

from China and Indonesia resulted in the share of imports rising to nearly 50%. On the other hand, 70% to 80% of our export product portfolio got impacted due to imposition of 15% export duty by the G

80%

ina and Indonesia resulted in the share of imports rising to nearly 50%. On the other hand, 70% to 80% of our export product portfolio got impacted due to imposition of 15% export duty by the Governme

22%

ion of 15% export duty by the Government of India. During Q1 FY'23, the combined export stood at 22%, which was lower than 26% clocked in the previous quarter. However, it remained higher at again 70

26%

the Government of India. During Q1 FY'23, the combined export stood at 22%, which was lower than 26% clocked in the previous quarter. However, it remained higher at again 70% in Q1 FY'22 with SPD ex

rs,

with SPD exports registered a 375 sales growth on a year-on-year basis. Despite the external factors, our business agility operational management, financial prudence and focused approach helped us to p

40%

l Stainless (Hisar) Limited July 28, 2022 In fact, in case of automobiles, we have increased by 40% on a sequential basis. Demand from metro sector continues to be steady with major national metro p

31%

during the quarter. On a year-on-year basis, the pro forma combined revenue for Q1 FY'23, rose by 31% on year-on-year basis, INR 2,815 crore. EBITDA impact for the same period stood at INR 832 crore

INR 2,815 crore

ear-on-year basis, the pro forma combined revenue for Q1 FY'23, rose by 31% on year-on-year basis, INR 2,815 crore. EBITDA impact for the same period stood at INR 832 crore and INR 475 crore, respectively. As far

INR 832 crore

3, rose by 31% on year-on-year basis, INR 2,815 crore. EBITDA impact for the same period stood at INR 832 crore and INR 475 crore, respectively. As far as our performance of the subsidiaries are concerned, the

INR 475 crore

year-on-year basis, INR 2,815 crore. EBITDA impact for the same period stood at INR 832 crore and INR 475 crore, respectively. As far as our performance of the subsidiaries are concerned, the combined EBITDA gr

“I am also happy to share with you that we are proud suppliers of stainless steel for construction of the Udhampur-Srinagar-Baramulla Railway Link tunnel project with its national importance.”

“This will be the first ever application of stainless steel cable trays in the Indian Railway project and we see many more opportunities in this sector.”

“Further details in this regard will be shared by Anurag later.”

“Through these ventures we will be able to conserve power and reduce its carbon emissions considerably With this, I would like to hand over to Anurag to discuss the operational and financial performance.”

“We have shared the earning presentation with stock exchanges and today's call discussion will be on the same lines.”

“However, our focused approach on niche product development and agile project mix helped us partly steer through these challenges and report a reasonable performance for the quarter.”

“Going forward, we are committed to develop a strong stainless steel ecosystem in the country by focusing an awareness, skill development, new product development and identification of sustainable applications for stainless steel.”

“And we expect the process to be completed in due time over next four to five months.”

“We believe that our strategic initiatives will be augmenting our performance in the long term, once the environment normalized.”

“So would you be revisiting your volume guidance for FY'23?”

Anurag Mantri

24

Abhyuday Jindal

13

Ritwik Shah

5

Moderator

3

Ritesh Shah

3

Kirtan Mehta

2

Abhijit Mitra

2

Aashav Patel

2

Amit Dixit

1

Nishit Shah

1

Abhyuday Jindal

Ladies and gentlemen, good day, and welcome to Jindal Steel and Jindal Steel Hisar Q1 FY'23 Earnings Conference Call. As a reminder, all participant lines will be in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing ‘*’ then ‘0’ on your touchtone phone. Please note that this conference is being recorded. And I'll hand the conference over to Mr. Rajesh Majumdar from Batlivala & Karani Securities India Private Limited. Thank you, and over to you, sir. Good afternoon, everyone, and welcome on behalf of B&K Securities to the earnings call of JSL and JSHL. We are represented today by Mr. Abhyuday Jindal, Managing Director, JSL and JSHL; Mr. Anurag Mantri, Group CFO Jindal Stainless Limited; Mr. Jagmohan Sood, Whole-Time Director JSHL; Mr. Ramnik Gupta, CFO JSHL; and Mr. Goutam Chakraborty and Ms. Shreya Sharma from the IR team. I would

Anurag Mantri

Jindal Stainless (Hisar) Limited July 28, 2022 Raw material prices continue to be highly volatile during the quarter. due to the ongoing Russia-Ukraine conflict and also the macroeconomic issues as well. After initial surge in the prices fell on account of unwinding of a speculative position increased control on the supply chain by government across the world to fight inflation. De-accelerating the Chinese economy due to the renewed COVID lockdowns and softening of logistic imbalances. At the end of Q1 FY'23, our pro forma combined entity net debt stood at INR 3,513 crore, down by 26% as against the March '20 level. As we have been saying, we have been able to maintain our leverage ratios efficiently, despite disruptions. For the combined entity while the debt equity stood at 0.4x, the debt EBITDA remains at 0.8x. Interest cost for the combined entity declined by 10% year-on-year basis on account of a lower interest rate. For both companies, the credit rating for long-term facilities a

Abhyuday Jindal

Yes, we don't expect export duty to be there for very long. So we are happy to continue our expansion process. Jindal Stainless (Hisar) Limited July 28, 2022

Anurag Mantri

Great. The second question is essentially on JUSL. Now you mentioned that, I was under the impression that JUSL already has a rolling capacity of 3.2 million tons per annum, I mean we are using 1.6 because of our own stuff. So in order to expand it to 3.6, first of all how much CapEx would be needed? And if you could let us know your CapEx estimate I mean in light of a lot of things that have happened for this year and maybe next year? That would be very helpful. So JUSL, the current capacity is 1.6, which is getting enhanced to 3.6 million ton, at a CapEx of some around INR 350 crore to INR 400 crore that's the overall CapEx, it's actually around INR 350 crore, so that's what the process in JUSL capacity expansion. Overall, your second question was on the CapEx of Jindal Stainless Limited, so if you recall that out of the last year INR 1,100 crore committed CapEx, we did only INR 950 crore, so around INR 150 crore CapEx was spilling over to this financial year. And this financial year

Abhyuday Jindal

No, INR 350 crore is not part of this. This I am talking about Jindal Steel and I talked about the INR 350 crore of JUSL CapEx. And over I mean how much period would it be spread the INR 350 crore to INR 400 crore? The JUSL CapEx will be close to around 12 to 15 months. FY'23, I think because see, the CapEx spill over will be some of these staggered, but overall, I think by in the beginning of FY'24 along with the JSL capacity, it will be aligned. Next question is from line of Nishit Shah from Aequitas Investment. Please go ahead. Sir, I would like to understand, how do you see the global demand supply scenario now? See, as of now whenever the commodity prices are falling, everybody gets into a destocking sort of situation and that is where the whole global stainless steel market is at right now and this is always the nature of our industry or the business. So we expect maybe this quarter also prices to be falling, then Q3 onwards again there should be some stability and demand should

Abhyuday Jindal

I can get back to you on that. That is I think maybe our partner would be investing and we would be getting into a sort of pay as we use model, but what investment we might have to do, that I can get back. It's not a very significant amount. Next question is from the line of Kirtan Mehta from BOB Capital Markets. Please go ahead. Okay. I was interested in understanding, you have listed that you faced double whammy both from the higher imports as well as sort of restriction on exports. Could you explain this situation across different product series 200, 300, 400, which one is more resilient and where you are seeing higher pressure? So the maximum pressure that we are seeing is in 200 series, that is because maximum dumping in 200 series is happening from China and that is where we are seeing from a domestic point of view from export because maximum export was in 300 series and with this 15% duty coming, the major impact on export has been on 300 series. Did that answer your question? J