ICICI Securities Ltd has expressed good prospects on the shares of Jindal Stainless Ltd. The brokerage firm says that it has talked to the management of Jindal Stainless. During this meeting, the company clarified its strategy. The company says that its plans to increase production capacity from 1.9 million tonnes per annum to 2.9 million tonnes are on track.
The company is laying full emphasis on the production of 400 series steel. The management says that its focus is on deleveraging and the merger of Jindal Steel Limited and Jindal Stainless (Hissar) has been completed. Its benefits will be available soon. ICICI Securities has given a ‘BUY’ rating for this stock and has a target price of Rs 230 per share.
Full emphasis on 400 series steel products
Jindal Stainless says that it has over 120 products in its portfolio. Management gave details of its 400 series product. According to the company management, Jindal Stainless Limited is one of the few companies in the world that uses liquid ferrochrome. This will reduce the cost of manufacturing of the 400 series. Blade Steel has a market share of 80 per cent and JSL is the largest supplier of Gillette in the world. Jindal Stainless has invested Rs 40 crore to address the bottlenecks in Jajpur with a production capacity of 1.1 million tonnes per annum.
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Jindal Stainless Target Price 230
According to ICICI Securities, Jindal Stainless Limited believes that the demand for 400 series steel in the country will increase. The 200/300 series steel accounts for more than 50 per cent of India’s steel demand. Most of the demand for 400 series steel is happening in the railway and auto sector. The way the pattern of steel consumption is changing in the country, the demand for 400 series steel will increase further. ICICI Securities has set a target price of Jindal Stainless at Rs 230 per share.
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