Crisil upgrades credit outlook for Jindal Stainless

Crisil Ratings has assigned a ‘CRISIL AA-‘ rating for JSL, while the company’s short-term bank facilities rating has been kept unchanged at ‘CRISIL A1+’.

While upgrading outlook for JSL, Crisil said it has considered parameters, including JSL’s successful completion of the merger process with Jindal Stainless Hisar Limited (JSHL), efficient working capital management, and sizable export presence.

According to Crisil, JSL’s leadership position in the domestic stainless steel industry, coupled with its agile business model, has helped it achieve capacity expansion to 2.9 million tonnes per annum.

Additionally, JSL’s strong liquidity, coupled with its strategic acquisitions, has led to sustainable improvement in EBITDA per tonne, according to the Crisil report.

Despite the capacity addition, Crisil said, JSL’s financial risk profile is expected to remain healthy.

The rating agency expects JSL’s business risk profile to continue improving, driven by its focus on high-margin segments, synergies arising from its recent acquisitions, and the completion of its planned capex in fiscal 2024.

The financial risk profile is also expected to remain healthy despite capex, aided by the sustenance of JSL’s margin profile, said the report.

“The upgraded outlook by CRISIL Ratings is a significant recognition of Jindal Stainless’ strong business fundamentals and its commitment to mitigating environmental and social risks. With our focus on creating a sustainable ecosystem, enhancing our melting capacities to fulfill the growing stainless steel demand and improving our environmental, social, and governance profile,” said Abhyuday Jindal, managing director, JSL.

On Thursday, JSL shares closed flat at ₹288.35 apiece on the National Stock Exchange.