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Feasibility Results – Yes
ABOUT CORPORATE BRIDGE
Corporate Bridge Group is formed by graduates from leading institutes (IITs, IIMs & AIM). "Corporate Bridge" as the name suggest, helps in bridging the gap between the aspiring entrant and the corporate world. Corporate Bridge is globally recognized training firm, providing blend of instructor-led and online financial training programs along with e-learning services. With Corporate Bridge's entrepreneurial spirit coupled with unparalleled experience (CLSA India, KPMG, YES Bank, JPMorgan, SBI Capital Markets, CRISIL etc) and comprehensive capabilities (MBA, CFA, FRM, CAs) across all industries and business functions, we commit to deliver a world class professional training and learning services that continues improving knowledge efficiency.
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EduCorporateBridge deals with Online and Instructor Lead Training Programs in various financial courses viz. Equity Research, Wealth Management, Technical Analysis Investment banking, Private Equity, Fundamental Analysis, Investment Research, Credit Research etc and preparatory courses like CFA Level I & II and FRM Level I & II, Campus Placement Trainings.
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Corporate Management Team
Kishor Gandhi- (Ex-MD at J.P. Morgan Chase & Company) Chief Mentor, Corporate Bridge Dheeraj Vaidya - (IIT Delhi, IIM Lucknow) Chief Executive Officer S. Premananda- (Ex-Yes Bank, IIT Delhi, IIM Calcutta) Kayideni Kholi - (Ex-Hinduja Group and SRSL, IIT Delhi, IIM Ahmedabad)
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31st August 2012
Product Offered by Corporate Bridge
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31st August 2012
Project financing is an innovative and timely financing technique that has been used by many high-profile corporate projects. Employing a carefully engineered financing mix, it has long been used to fund large-scale natural resource projects, from pipelines and refineries to electricgenerating facilities and hydro-electric projects. Increasingly, project financing is emerging as the preferred alternative to conventional methods of financing infrastructure and other large-scale projects worldwide. International Project Finance Association (IPFA) defined project financing as: “The financing of long-term infrastructure, industrial projects and public services based upon a non-recourse or limited recourse financial structure where project debt and equity used to finance the project are paid back from the cash flows generated by the project.” Project finance is especially attractive to the private sector because they can fund major projects off balance sheet. Project Financing discipline includes understanding the rationale for project financing, how to prepare the financial plan, assess the risks, design the financing mix, and raise the funds. In addition, one must understand the cogent analyses of why some project financing plans have succeeded while others have failed. A knowledge-base is required regarding the design of contractual arrangements to support project financing; issues for the host government legislative provisions, public/private infrastructure partnerships, public/private financing structures; credit requirements of lenders, and how to determine the project's borrowing capacity; how to prepare cash flow projections and use them to measure expected rates of return; tax and accounting considerations; and analytical techniques to validate the project's feasibility Project finance is finance for a particular project, such as a mine, toll road, railway, pipeline, power station, ship, hospital or prison, which is repaid from the cash-flow of that project. Project finance is different from traditional forms of finance because the financier principally looks to the assets and revenue of the project in order to secure and service the loan. In contrast to an ordinary borrowing situation, in a project financing the financier usually has little or no recourse to the nonproject assets of the borrower or the sponsors of the project. In this situation, the credit risk associated with the borrower is not as important as in an ordinary loan transaction; what is most important is the identification, analysis, allocation and management of every risk associated with the project.
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including revenue producing contracts. First priority on project cash flows is given to the Lender. 5) Avoid any negative impact of a project on the credit standing of the sponsors. Can be up to 60bp 3) Project debt is substantially more expensive (50-400 basis points) due to its non-recourse nature. 6) Obtain better financial conditions when the credit risk of the project is better than the credit standing of the sponsors. Page 4 of 32 . 3) Limited recourse to project sponsors. 7) Allow the lenders to appraise the project on a segregated and stand-alone basis. 8) Obtain a better tax treatment for the benefit of the project. 2) Permit an off-balance sheet treatment of the debt financing. Advantages of Project Finance 1) Eliminate or reduce the lender’s recourse to the sponsors.India Sector Review 31st August 2012 Characteristics of Project Finance The key characteristics of project financing are: 1) Financing of long term infrastructure and/or industrial projects using debt and equity. Disadvantages of Project Finance 1) Often takes longer to structure than equivalent size corporate finance. 2) Higher transaction costs due to creation of an independent entity. 4) Extensive contracting restricts managerial decision making. 4) Avoid any restrictions or covenants binding the sponsors under their respective financial obligations. 2) Debt is typically repaid using cash flows generated from the operations of the project. the sponsors or both. 4) Debt is typically secured by project’s assets. Consent of the Lender is required to disburse any surplus cash flows to project sponsors Higher risk projects may require the surety/guarantees of the project sponsors. 3) Maximize the leverage of a project. 5) Project finance requires greater disclosure of proprietary information and strategic deals.
Post Financing Stage Financing Stage Pre Financing Stage About the Project I have selected the project finance topic to check the feasibility report for JSW Steel. Page 5 of 32 . There are various assumptions taken into consideration for the making of this report and they are mentioned below.India Sector Review 31st August 2012 Stages in Project Financing 1) Project identification 2) Risk identification & minimizing 3) Technical and financial feasibility 4) Equity arrangement 5) Negotiation and syndication 6) Commitments and documentation 7) Disbursement. calculation of various ratios to check the feasibility of the project and then giving final recommendation on the basis of the above steps taken into consideration. Historical Ratio analysis of JSW Steel. preparation of financial model of the project taking into consideration various mentioned assumptions. 8) Monitoring and review 9) Financial Closure / Project Closure 10) Repayments & Subsequent monitoring. The project has various parts that it is divided into and they are Steel Sector Analysis.
Market Scope o India is fourth largest crude steel producing country in the world and is expected to grow as the 2nd largest producer by FY15-16 according to World Steel Association.3083. Additional capacity created o De-licensing in the Indian Iron and Steel Industry resulted in additional capacity creation in the private sector which required an investment of Rs. India heading forward o Production of steel increases by 3.5mn or approximately 13mn tonnes per annum.India Sector Review 31st August 2012 Steel Industry & Importance of this Project Steel Industry Sector Overview Restructuring of Steel Industry o No of economic reforms were made in FY91-92 by the Indian Government which enhanced the Steel Industries growth process particularly.56mn tonnes. Page 6 of 32 .2% in terms of IIP (Index of Industrial Production). o 301 MoUs signed with various states for strategic expansion of capacity of approximately 488. o The Steel Industry contributes about 2% to the GDP of the country and Industry Contribution weighs 6.5% for April 2012 higher than the world average. o Major changes – No license required for capacity creation. o India remains at 1st position in terms of producer of Direct Reduced Iron (DRI) in the world since 2002. unrestricted external trade. low import duties. easy tax structure and also the doors were opened to the private sector through the route of Foreign Investment which was predominately occupied by the public Sector.
Page 7 of 32 .5 89 88.5 90 89. globalization and liberation thus leading to the growth of the country.00 15.5 88 87.00 0.00 -5.00 5. we can see that the production has been increasing on the continuous basis after the reforms of 1991 as there were the doors opened to privatization.India Sector Review 31st August 2012 Figure 1 Production in Million Tonnes 120 100 80 Improvement in Production after Economic Restructuring 25.00 20.5 87 Source: Joint Plant Commission (JPC) The above chart show.00 10. how there is still under-utilization of the capacity and thus there is a possibility of brown field expansion. living a room for expansion 100 70 60 Million Tonnes 50 40 30 20 10 0 Capacity Crude Steel Production Utilization (%) 80 60 40 20 0 90. Figure 2 India’s growing crude steel production Million Tonnes Under-utilized Production Capacity thus.00 1991-1992 1992-1993 1993-1994 1994-1995 1995-1996 1996-1997 1997-1998 1998-1999 1999-2000 2000-2001 2001-2002 2002-2003 2003-2004 2004-2005 2005-2006 2006-2007 2007-2008 2008-2009 2009-2010 2010-2011 Finished Carbon Steel Pig Iron DRI Growth 60 40 20 0 Source: Joint Plant Commission (JPC) As in the above chart.
3% per annum Import Export Demand Source: Joint Plant Commission (JPC).000 0.7% and fiscal deficit Impact of Economic reforms expected to escalation ~5-5. Provides direct employment to 5 lac people.000 6.3083.000 5.000 1.000 2.000 3. Growth Prospects o The Steel Industry contributes about 2% to the GDP of the country and weighs 6. Planning Commission Report for 12th Five Year Plan The above chart shows the demand pattern for steel in the country and we can observe that the demand for steel has been increasing continuously and also the exports are expected surpass import as there are many Greenfield and brown expansion expected to be carried on in the near future. o High interest rate.India Sector Review 31st August 2012 Figure 3 Import Export Trend of India India to soon become a net exporter of steel 8. Page 8 of 32 . double digit inflation.5mn or approximately 13mn tonnes per annum.5% in FY12.000 7. o Current Account Deficit has expanded to 3. Creation of Additional Capacity o De-Licensing in the Indian Iron and Steel Industry resulted in additional capacity creation in the private sector which required an investment of Rs.2% in terms of IIP (Index of Industrial Production).000 4. policy restructuring and global economic conditions is hampering the growth of the sector.000 120 100 80 60 40 20 0 Demand expected to grow at 10.
India Sector Review 31st August 2012 Figure 4 Per Capita Consumption (Kg) of Steel Per Capita Consumption has CAGR of around 9% Steel Demand Drivers in India Construction & Inrastructure Auto & Auto Components 62% Capital Goods White Goods 60 50 40 Construction and Infrastructure major sector which demand steel 5% 6% 5% 12% 30 20 10 0 200506 201011 10% Source: Joint Plant Commission (JPC) Source: JSW Steel Annual Report In the above chart we can observe that the per capita consumption of steel has CAGR of around 9%. Non-Coking Coal. Page 9 of 32 . Figure 5 Estimated Raw Materials Requirement Steel Industry on the way of expansion 2016-17 Production to reach new levels 2011-12 0 100 200 300 400 500 600 700 800 Coking Coal Ferro Alloys Non-Coking Coal Refractories Iron Ore Source: Planning Commission Report for 12th Five Year Plan As we can see in the above chart. Ferro Alloys and Refractories. Capital Goods and White Goods respectively. Iron Ore. we can observe that the production is expected to increase and therefore also the raw material requirement of various inputs like Coking Coal. Also in the other chart we can observe that the major demand for steel is from the infrastructure sector and then followed by Auto.
India ranks 4th in the world steel production after Japan and United States ranks 2nd and 3rd respectively and India is expected to climb the ladder to the 2nd position by 2015-16 as reported by WSA. expected to be 2nd largest producer by FY15-16 3% 5% 5% World Crude Steel Production in FY11 was 1527mn tonnes which increased by 6.5-12. leading to increasing index price 400 350 300 250 200 150 100 50 0 2007-08(Q1) 2007-08(Q2) 2007-08(Q3) 2007-08(Q4) 2008-09(Q1) 2008-09(Q2) 2008-09(Q3) 2008-09(Q4) 2009-10(Q1) 2009-10(Q2) 2009-10(Q3) 2009-10(Q4) 2010-11(Q1) 2010-11(Q2) 2010-11(Q3) 2010-11(Q4) 2011-12(Q1) 2011-12(Q2) TMT H R Coil Iron Ore Coking Coal Source: Planning Commission Report for 12th Five Year Plan.8%as compared to FY10 3% 3% 3% China Japan United States India Russia 56% South Korea Germany Ukraine 6% 7% 9% Source: World Steel Association (WSA) The above graph shows the production of steel in different countries of the world and as we can see China ranks no.5mm).1 in the production of steel and it produces around 56% of the world steel production. Coking Coal (10.India Sector Review 31st August 2012 Figure 6 Movement in Price Index of Steel and its Inputs: Base Year FY07-08=100 Steel Prices to rise further thus.55 ash) Figure 7 World Production of Crude Steel India moving up in the ladder. Page 10 of 32 . HR Coil (2. Specifications: TMT (10mm).
Source: Joint Plant Commission Figure 9 Major Players Players in Steel Industry according to their production capacity in Million Tonnes 4% 4% Sail 20% Tata Steel JSW Steel RINL 20% 4% 14% ESSAR 34% JSW Ispat JSPL Source: Company Reports The above chart shows the major players in the steel sector according to their production capacities and according to this.India Sector Review 31st August 2012 Figure 8 Public Sector Undertakings Dipping profits and under performance of PSUs leads to rising concern for Government MOIL SAIL KIOCL Ltd. But now Page 11 of 32 . NMDC Public Undertakings HSCL FSNL RINL MSTC MECON Ltd. Tata Steel is the major producer of steel followed by Sail and Essar and then JSW Steel-low cost producer of steel and then JSPL. JSW Ispat and RINL respectively.
India Sector Review 31st August 2012 Figure 10 Foreign Investment-100% FDIs allowed Foreign Investments increased by 20% in Indian Company thus leading to the growth of the sector 900 800 700 600 500 400 300 200 100 0 2008-09 2009-10 2010-11 2011-12 Source: Department of Industrial Policy & Promotion. Ministry of Commerce Strengths SWOT Analysis of Steel Sector Weakness Abundant Iron Ore availability of high Fiscal deficit quality Cost – effective labour Available Technical manpower High possibility for Stock Market Volatility Increasing Inflation technical Increasing cost of Materials captivation Low investment because of increasing cost of credit Opportunities Growing domestic market Market Opportunities in Threats Uncertain Global Market some Dependency on imported technology neighboring countries and other parts of the world Proposed huge investment in Increasing Domestic Demand Infrastructure expansion and also new National Manufacturing Policy during 12th five year plan Unused Capacity China becoming Net Exporter Page 12 of 32 .
o Investment in Infrastructure Sector is expected to be around 1 trillion dollars in the 12th five year plan as reported in the planning commission report. non-durable consumer goods thus increasing the per capita consumption of steel. engineering industries. irrigation and water supply has led to the requirement of additional production of the steel in the country. Page 13 of 32 . o Increasing middle class population also leads to create extra demand for automobiles. o Increasing consumption in allied industries such as automobiles. o It is also expected that the manufacturing sector is expected to grow at 11-12% from the current growth of 8%. o Increasing demand from the rural/ semi urban and retail sector is leading to a growth in demand from these sectors which are an untapped market as of now leaving a room for expansion in these sectors. packaging. which shows there is a requirement to increase the steel consumption in the country. o This type of financing is very helpful for the company as it gives them advantage of repaying the loan from the cash flows the company generates.India Sector Review 31st August 2012 Importance of this Project in the Current Environment o Growth in consumption of steel in an economy is dependent on the rate of growth in the GDP of that country.
Cement and Information Technology. Aluminium. It has strong universal existence in the global value-added steel sector with the purchase of steel mill in US and a service centre in UK and Joint Venture in Georgia and also Japan by tying up with JFE Steel Corp for manufacturing of high quality automotive steel.000 cr through debt for auto steel plant in berllary district Logistics. This enterprise is led by Sajjan Jindal and has grown JSW Steel production has augmented by 25% y-o-y in May 2012 as compared with May 2011 from a steel rolling mill in 1982 to a multi business conglomerate which is worth US$ 10bn within a short span of time. HR Plates / Coils/ Sheets/ Profiles. Bar.India Sector Review 31st August 2012 Company Description JSW Group is one of the fastest growing conglomerates with a strong presence in the economic sector.3. It is engaged in manufacture of flat and long products viz. Infrastructure and Company is expected to raise Rs. Ltd. and with manufacturing facilities in Karnataka. The product range caters to a gamut of industries in White goods & construction sectors. Page 14 of 32 . Maharastra and Tamil Nadu. Minerals and Mining. SW Group has diversified interests in Steel. Rounds & Rebars. Energy. which was operating a mini steel mill at Tarapur in Maharashtra and renamed it as Jindal Iron and Steel Co. JSW Steel is the largest private steel producer in India in terms of installed capacity after it had acquired major stake in Ispat Industries Ltd.. The Group set up its first steel plant near Mumbai in Vasind in 1982 and after that it acquired Piramal Steel Ltd. It has the largest Galvanising capacity in India and also the largest Indian exporter of with its presence in 74 countries.
o Start of construction on 1-Jul-12 and the plant is expected to start its commercial operation from 2-Jul-15 o Debt Equity Ratio will be 1.16.India Sector Review 31st August 2012 Financial Feasibility Assessment Model (maximum 2 pages) Inputs & Assumption Discussions Product Portfolio to remain same as that of JSW Steel o Company is expected to set up a new plant in West Bengal project and expected capital outlay of approximate Rs.5mtpa o Upfront Equity is 50% o Repayments of Term Loan starting from 31-Mar-17 for 24 Qtrs ending on 31-Mar-23 with 9.5% as the interest rate and 0.000 cr.5% as financial charges.5times The production capacity of the new plant is 4. Project Cost Discussions Expenditure is done in a phased manner Page 15 of 32 .
India Sector Review 31st August 2012 Assumption Snapshot Figure 1 Average Sales Realization Table Production of various products and average sales realization in cr per tonnes Figure 2 Production of different products as reported in AR2010-11 Installed capacity in thousands and % that each product contributes in accordance with total production Figure 3 Production of different products as reported in AR2010-11 Production of product portfolio of the new plant is assumed to be in line with JSW Steel capacity Page 16 of 32 .
India Sector Review 31st August 2012 Figure 4 Average Cost per tonne of each Raw Materials Figure 5 Amount to invested for each items in every quauter Figure 6 % of Depreciation charged under SLM Method and IT WDV Method IT WDV method used to find the actual income to be taxed Page 17 of 32 .
India Sector Review 31st August 2012 Figure 7 Tax Assumption Table Page 18 of 32 .
o EBIT is also increasing which shows that sales is increasing at the higher rate than Expenses other than Interest and Tax. EBITDA and EBIT in increasing continuously as compared with the net sales o Page 19 of 32 . Gross Profit is constant as compared with the net sales Gross Margin EBITDA. EBIT discussions o The Gross Profit Margin is constant at 47% throughout.India Sector Review 31st August 2012 Profit & Loss Statement – Project Finance Model Revenue is increasing in initial years and then growing by a steady rate o Revenue has increased tremendously by 60% for the 2nd yr of operation. o EBITDA for the company is in increasing trend which shows that the sales are increasing at a higher rate than the cost of sales. whereas later the revenues are increasing by approximately 5% annually. o Further it is expected to grow at the grow rate of approximately 5% annually.
India Sector Review 31st August 2012 Page 20 of 32 .
India Sector Review 31st August 2012 Page 21 of 32 .
India Sector Review 31st August 2012 TAX CALCULATION Page 22 of 32 .
India Sector Review 31st August 2012 Company is following Zero Dividend policy for newly setup plant Balance Sheet – Project Finance Model o All the net income of the company is transferred to reserves and surplus. o The company has good amount of cash available at their disposal to meet their short term obligations. Company has redeemed their long term loans in course of time o The long term loan of the company is paid off gradually and which shows the company is in good position and is not much dependent on the external financing. Page 23 of 32 . o Since it is the new plant the company has invested in gross block Company follows conservative approach as it is not involved in investing activities in initial phases of construction and not expanding later. as it has sufficient amount of reserves the company has so that shows that the company can finance any further requirement of funds from reserves and surplus. o The company has sufficient amount of working capital to meet their day to day operations of the plant.
o The company has eventually paid off their debt thus making the company free from long term debts as still it is dependent for cash credit which is a short term liability for the company.e.India Sector Review 31st August 2012 Capital Structure Discussions o The company is dependent on external funds to the extent of 60% which makes the debt/Equity ratio at 1. either Equity or Debt as the profits earned by the company is transferred to reserves and surplus account.5 times which is Dependency on debt funds reduced gradually quiet acceptable. Cash Flows – Project Finance Model o The company has positive cash flow for all the years which is a good sign as the company has enough cash at their disposal to fund their outflows. o As it is the new plant company is not in expansion mode so it is not in need of funds i. Chart showing the debt and equity with the company in any given FY in cr. o The company has raised Debt and Equity in the initial years and later on the company paid off their debt completely. Page 24 of 32 .
Page 25 of 32 .India Sector Review 31st August 2012 Chart showing the cash inflow and cash outflow in every year in cr.
67times which signify that the company has good amount of earnings to pay off the interest and the principal payments on debt. it is also the rate at which the project is expected to generate growth and here the company is expected to grow at around 19% which is a favourable growth rate. IRR Calculation Table Page 26 of 32 . DSCR Calculation Table IRR IRR is the rate of return where the present value of cash inflows are just equal to the present value of cash outflows.India Sector Review 31st August 2012 Project Appraisal DSCR The Average DSCR and Minimum DSCR for the project are 3.5times and 1.
Net Profit of the company is increasing continuously which shows that the Net Sales is increasing at higher rate than compared with the Cost of Goods Sold. Project Finance Ratio Calculations Page 27 of 32 . The PBDIT/ Interest ratio is increasing as the interest of debt is reducing gradually.India Sector Review 31st August 2012 Project Finance Ratios Current Ratio for the project is increasing which shows that company has adequate cash at their end to meet their short term obligations. ROCE is increasing initially as the PBDIT is increasing at a higher rate than Total Tangible Assets which shows that the efficiency and the profitability on the capital invested and it is because in the initial years the company had preliminary expenditure which reduced the total tangible assets of the company. Net Operating Profit is increasing continuously which shows that the Net Sales of the company is increasing at a higher rate than compared with operating expenses.
Project Finance BEP & Cash BEP Calculations Page 28 of 32 . Even the Cash BEP of the company is decreasing which shows that the amount of sales required to cover up the cash expenses of the company.India Sector Review 31st August 2012 BEP & Cash BEP Calculations The BEP is decreasing which shows the amount of Sales the company requires to meet the expenditure is also decreasing and it also signifies that the company is able to cover up the expenses and bring in sufficient profit.
118.4cr from Rs.32cr and also the interest has reduced thus increasing the bottom-line. o As the company has positive Cash Flows it shows that the company is self reliant to meet up its expenses/ Outflows and is not much dependent on external funds. BEP and Cash BEP has also improved from 34. o No DSCR o The IRR is approximately same and the BEP and Cash BEP has also improved from 34.8cr from Rs.India Sector Review 31st August 2012 Final Conclusions & Sensivity Analysis Conclusion o As the company is able to generate sufficient profits and as the Net profits as the percentage of net sales is increasing constantly.647. the IDC has also reduced from Rs. o As the debt has reduced. it is feasible to continue with the project.02times respectively.73% respectively which shows the amount of top line required has reduced to cover up the expenses considerably.25times and 2.16. o The IRR of the project is constant and the Avg.118.84% to 29.1190. 0% Debt o The total project cost reduces to Rs.15.17. o There is also an improvement in the Avg. o As 0% Debt there is no IDC and no Interest thus increasing the bottom-line considerably.84% to 33.92% respectively which shows the amount of top line required has reduced to cover up the expenses.1471.67times to 4.23cr to Rs.7cr.7cr.5times and 1.837. Sensitivity Analysis Debt is reduced from 60% to 50% o The total project cost reduces to Rs.95% to 24. DSCR and Minimum DSCR from 3. o The BEP and the cash BEP of the company are decreasing continuously which shows that the company requires the minimum sales to cover up its expenses.17.89% and 25.74% and 20.89% and 25. Page 29 of 32 .
India Sector Review 31st August 2012 100% Debt o The total project cost increases from Rs.3cr.17.5times and 1. DSCR and Minimum DSCR from 3.89% and 25.02% respectively which shows the amount of top line required has increased to cover up the expenses considerably.98times respectively.118. Page 30 of 32 .99times and 0.84% to 39.38% and 30.7cr to Rs.466.67times to 1.18. The IRR has increased slightly and the BEP and Cash BEP has also deteriorated from 34. o There is also a decline in the Avg. o As 100% Debt there is a sharp rise in IDC and Interest thus reducing the bottom-line considerably.
3mtpa cold rolling mill to manufacture high quality steel for automobile sector.940/ Rs.12mn Price Target Target Set on 12 760 5 Jul th Top line vaguely flat.India Sector Review 31st August 2012 Steel Going Solid Reuters Bloomberg JSTL.32x Market cap full/free float Rs.49% 20. it is not in need of additional funds to meet their day to day expenses as the company’s bottom line is transferred to the reserves and surplus as the company is following conservative approach Comparative Analysis Backing Project requirement The company has planned to fund its expenses through debt and equity in the Source: ET as of 13th Jul 12 ratio of 1.285mn Dividend P/O Ratio 75% Shares in Issue 223.7 12M hi/lo Rs.154. and as the company is doing well operationally it has redeemed their debt and is not dependent on the debt funds to fund its operational requirements as it is covered up by the reserves of the company.32x as compared with the peer group and market capitalization of Rs.34% 6. it is feasible to finance this project as the company has projected cash flows are positive and shows that the Source: BSE company can generate enough cash flows to fund its expansion plan in West Bengal. Bottom Line Improving The Top line of the new plant that is expected to be operational from FY15-16 is improving initially at a higher rate but then later is growing at a steady rate of 5%.RS JSTL. 1982.464 Shareholding Pattern Promotors FIIs Others P/E Ratio 35.IN After the incorporation of JSW Steel Ltd. Rating According to above model and various arguement. The bottom line of the company as compared with the top line of the company is growing at a faster rate which shows that the company is doing fair. the company has done well and now it is one of the lowest cost producer of steel in world and one of the largest manufacturer of India with the P/E Ratio of 6. The company is expected to expand its operations and increase their production capacity by setting up Greenfield projects in Jharkhand and West Bengal.000cr through issue of debt for setting up plant in bellary and is expected to be operational from 2013 with the installed capacity of 2. The company is planning to raise Rs.5x. Page 31 of 32 .154.3. Priced on 13th Jul 2012 India Sensex@ 17.213.17% 44. As the company is not expected to invest more in the tangible assets.285mn.
India Sector Review 31st August 2012 Spanshot of Financials of New Plant Page 32 of 32 .
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