JINDAL STAINLESS LIMITED Q4 & FY20 Earnings Presentation - PowerPoint PPT Presentation

JINDAL STAINLESS LIMITED Q4 & FY20 Earnings Presentation June 6, 2020

Disclaimer This presentation and the accompanying slides (the “Presentation”), which has been prepared by Jindal Stainless Limited (the "Company"), has been prepared purely for information purposes only and is not, and is not intended to be, an offer, or solicitation of offer, or invitation or recommendation or advise to buy or sell or deal with any securities of the Company, and shall not constitute an offer, solicitation or invitation or recommendation or advise to buy or sell or deal with any securities of the Company in any jurisdiction in which such offer, solicitation or invitation or recommendation or advise is unlawful or in contravention of applicable laws. No part, or all, of this Presentation shall be used or form the basis of, or be relied on or referred to in connection with, any contract or investment decision in relation to any securities of the Company. This Presentation is strictly informative and relating to the financial conditions, internal functioning, day to day operations, future events and projections etc. of the Company and this presentation shall not be used or relied upon or referred to in whole or in part, for any purpose whatsoever. The information in this Presentation is being provided by the Company and is subject to change without any notice or liability. This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, veracity, fairness, integrity, sufficiency and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and exhaustive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded. This Presentation contains statements about future events and expectations that are forward-looking statements. These statements typically contain words such as "expects" and "anticipates" and words of similar import. Any statement in this Presentation that is not a statement of historical fact is a forward-looking statement that involves known and unknown risks, uncertainties, contingencies and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. None of the future projections, expectations, estimates or prospects in this Presentation should be taken as forecasts or promises nor should they be taken as implying any indication, assurance or guarantee that the assumptions on which such future projections, expectations, estimates or prospects have been prepared are correct or exhaustive or, in the case of the assumptions, fully stated in the Presentation. The Company assumes no obligations or responsibility to update the forward-looking statements contained herein to reflect actual results, changes in assumptions or changes in factors affecting these statements. You unconditionally and irrevocable acknowledge and undertake that you will be solely responsible for your own assessment of the market, the market position, the business and financial condition of the Company and that you will conduct your own analysis and be solely responsible for forming your own view of the potential future performance of the business of the Company. All the risks, liabilities or consequences arising out of or consequent to the use of or reliance on or reference to this Presentation and/or acting on the basis of the analysis/views formed by you, shall be solely borne by you. This Presentation speaks as of the date mentioned herein. Neither the delivery of this Presentation nor any further discussions of the Company with any of the recipients shall, under any circumstances, create any implication that there has been no change in the affairs of the Company since that date. 2

Q4 & FY20 Results Overview 3

Key Financials Highlights – Q4 & FY20 Net Revenue from operations EBITDA 12,585 12,320 1,175 1,136 3,251 3,179 2,904 302 302 241 Q4 FY19 Q3 FY20 Q4 FY20 FY19 FY20 Q4 FY19 Q3 FY20 Q4 FY20 FY19 FY20 Shift (%) QoQ: (9%) YoY: (11%) (2%) Shift (%) QoQ: (20%) YoY: (20%) 3% PAT 153 139 56 32 -22 Q4 FY19 Q3 FY20 Q4 FY20 FY19 FY20 Shift (%) QoQ: NA YoY: NA 10% 4 Note: Standalone financials; All figures in Rs. crore unless stated otherwise

Key Operational Update – Q4 & FY20 Sales Volume (MT) 916 852 Thousands 239 225 221 Q4 FY19 Q3 FY20 Q4 FY20 FY19 FY20 Shift (%) QoQ: (8%) YoY: (2%) 7% Sales Composition – FY20 Sales Composition – Q4 FY20 Export Export 21% 22% Domestic Domestic 78% 79% 5 Note: Standalone financials

Key Raw Materials – Price Trend Nickel (USD/MT) 15,540 15,450 13,266 12,723 12,369 12,258 11,516 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Note: Average quarterly prices; Source: LME Fe Chrome (INR/ton) 75,617 76,583 69,304 71,400 64,258 64,258 60,950 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 6 Note: Average quarterly prices; Source: Steel Mint

Q4 FY20 Financial and Operational Discussions (Standalone)  Net revenue fell by 11% Y-o-Y at Rs. 2,904 crore o Sales volume was lower by 2% Y-o-Y largely due to muted economic sentiments given the COVID-19 outbreak  EBITDA stood at Rs. 241 crore, down by 20% Y-o-Y o Steadily falling Nickel during Q4 negatively impacted inventory valuation  Net loss reported at Rs 22 crore for the quarter o Exceptional loss stood at Rs. 48 crore as against loss of ~Rs. 1 crore Y-o-Y on account of forex movement o Finance cost fell by 11% Y-o-Y to Rs. 143 crore 7

FY20 Financial and Operational Discussions (Standalone)  Net Revenue remained almost flat Y-o-Y at Rs. 12,320 crore o The Company recorded the highest ever stainless steel production at 974 kt; Sales volume rose by 7% Y-o-Y to 916 kt  EBITDA rose by 3% Y-o-Y to Rs. 1,175 crore o EBITDA/ tonne stood at Rs. 12,827  PAT grew up by 10% Y-o-Y to Rs. 153 crore o Finance cost fell by 8% Y-o-Y to Rs. 567 crore 8

Management Comment “JSL recorded steady operational performance in FY19- 20. As GDP growth slowed down in the last quarter of the Commenting on fiscal, we witnessed erosion in margins. the performance, Going forward, we are turning our focus on growing Mr. Abhyuday markets, such as the two-wheeler and healthcare industries. Jindal, The domestic stainless steel industry, which has long Managing required relief from imports from ASEAN and FTA Director, Jindal countries, has both the capacity and the capability to cater Stainless Ltd. to Indian demand. said: We are hopeful for affirmative government action under the Atmanirbhar package. Successful implementation of the Vocal for Local call by the government will go a long way in ensuring job generation and demand revival in the economy. ” 9

Abridged P&L Statement (Standalone) YoY YoY Particular (Rs. crore) Q4 FY20 Q4 FY19 FY20 FY19 Change (%) Change (%) Net Revenue from operations 2,904 3,251 (11%) 12,320 12,585 (2%) Total Expenditure 2,662 2,949 (10%) 11,145 11,449 (3%) EBITDA 241 302 (20%) 1,175 1,136 3% EBITDA / ton 10,917 13,443 (19%) 12,827 13,325 (4%) EBITDA margin (%) 8.3% 9.3% (98 bps) 9.5% 9.0% 51 bps Other Income 11 9 20% 37 28 34% Finance Cost 143 161 (11%) 567 614 (8%) Depreciation 99 92 8% 409 335 22% Exceptional gain/(loss)* (48) (1) NA 8 6 32% PBT (38) 57 NA 244 221 11% Tax (16) 24 NA 91 82 12% PAT (22) 32 NA 153 139 10% PAT margin (%) (0.8%) 1.0% NA 1.2% 1.1% 14 bps EPS (Diluted) in INR (0.5) 0.7 NA 3.2 2.9 9% * Exceptional items represent net foreign exchange gain/(loss) and mark-to-market gain/(loss) on foreign exchange derivative, forward contracts 10

Abridged P&L Statement (Consolidated) YoY YoY Particular (Rs. crore) Q4 FY20 Q4 FY19 FY20 FY19 Change (%) Change (%) Net Revenue from operations 3,094 3,547 (13%) 12,951 13,557 (4%) Total Expenditure 2,873 3,243 (11%) 11,811 12,393 (5%) EBITDA 222 304 (27%) 1,139 1,165 (2%) EBITDA / ton 10,015 13,522 (26%) 12,441 13,661 (9%) EBITDA margin (%) 7.2% 8.6% (141 bps) 8.8% 8.6% 21 bps Other Income 13 11 19% 40 33 22% Finance Cost 148 167 (11%) 586 637 (8%) Depreciation 104 97 7% 425 352 21% Exceptional gain/(loss)* (51) (1) NA 4 1 563% Share of profit of investments gain/(loss) (5) 3 NA (8) 12 NA PBT (73) 54 NA 165 222 (25%) Tax (7) 19 NA 93 77 21% PAT (66) 34 NA 73 145 (50%) PAT margin (%) NA 1.0% NA 0.6% 1.1% (51 bps) EPS (Diluted) in INR (1.3) 0.7 NA 1.5 3.0 (50%) * Exceptional items represent net foreign exchange gain/(loss) and mark-to-market gain/(loss) on foreign exchange derivative, forward contracts 11