Jsw Steel Limited · NSE:JSWSTEEL
Jsw Steel — Q2 FY2023 Earnings Presentation
47 slides from Jsw Steel's earnings presentation, Oct 21, 2022
Slide 1: Exchange filing cover letter
JSWSL: SECT: MUM: SE: 2022-23 October 21, 2022 1. National Stock Exchange of India Ltd. 2. BSE Limited Exchange Plaza Corporate Relationship Dept. Plot No. C/1, G Block Phiroze Jeejeebhoy Towers Bandra – Kurla Complex Dalal Street, Mumbai – 400 001. Bandra (E), Mumbai – 400 051 Scrip Code No.500228
Slide 2: Q2 FY2023 Results Presentation
Q2 FY2023 Results Presentation 21 October 2022
Slide 3: Forward Looking and Cautionary Statement
Forward Looking and Cautionary Statement Certain statements in this report concerning our future growth prospects are forward looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward looking statements. The
Slide 4: Key Highlights – Q2 FY23
Key Highlights – Q2 FY23 • Revenue from Operations: ₹41,778 crore • Operating EBITDA: ₹1,752 crore Consolidated • Net Loss: ₹915 crore Performance • Net Debt to Equity: 1.04x and Net Debt to EBITDA1: 2.70x • Average capacity utilization of 86% in Q2 FY23 for standalone operations (incl. Dolvi Phase-
Slide 5: Agenda
Agenda Sustainability Business Environment Operational Performance Financial Performance Outlook & Project Updates Digitalisation at JSW Steel JSW Steel Q2 FY23 Results Presentation 4
Slide 6: Agenda
Agenda Sustainability Business Environment Operational Performance Financial Performance Outlook & Project Updates Digitalisation at JSW Steel JSW Steel Q2 FY23 Results Presentation 5
Slide 7: Sustainability Framework and Priorities
Sustainability Framework and Priorities 17 Focus Areas Governance & Oversight By Board-level Business Responsibility And Climate Change: Biodiversity: No Net Loss for Biodiversity Sustainability Committee • Aligned to India’s Nationally Determined Contributions for Climate Change as per Ms. Fiona Pa
Slide 8: Environment: Targets and Strategy
Environment: Targets and Strategy SD Targets FY05 FY30 Targets Improvement Strategic Approach • Transition from thermal to renewable energy • Specific Energy • Reduction of fuel rate in BF and DRI GCal/tcs 6.94 5.65 19% Climate • Increased use of scrap in steel making Change • GHG Emissions 3.39 1.9
Slide 9: Health & Safety
Health & Safety JSW is committed to providing a safe and healthy working environment and achieving an injury- & occupational illness-free workplace. Our vision is to achieve ‘Zero Harm’ Building a Culture of Health & Safety JSW’s Roadmap to Vision 000 Zero Zero Zero major injury harm incidents Healt
Slide 10: Our Communities
Our Communities Key intervention areas Health & Agriculture Nutrition Water, Environment & Education Mega health and cancer detection Eye camps to extend Vision Screening Sanitation camp in Odisha and Correction at Vasind & Dolvi Waste Skill management development Art, culture & Sports heritage 51 C
Slide 11: Sustainability Initiatives & Recognitions
Sustainability Initiatives & Recognitions Initiatives - Decarbonisation in Focus United Nations Global Compact JSW Steel becomes a participant of the United • SEED (Sustainable Energy Environment and Nations Global Compact Decarbonisation) program initiated at Vijayanagar • Aimed at building granula
Slide 12: Environmental Performance
Environmental Performance Specific Energy Consumption (Gcal/tonne) GHG Emission Intensity (tCO2/tcs) Specific Freshwater Consumption (m3/tcs) 2.75 6.59 6.56 4.13 3.79 6.38 6.24 2.59 2.52 2.60 2.41 2.45 2.43 6.04 2.49 2.50 5.92 2.40 FY18 FY19 FY20 FY21 FY22 H1 FY23 FY18 FY19 FY20 FY21 FY22 H1 FY23 FY
Slide 13: Agenda
Agenda Sustainability Business Environment Operational Performance Financial Performance Outlook & Project Updates Digitalisation at JSW Steel JSW Steel Q2 FY23 Results Presentation 12
Slide 14: Global Economy
Global Economy GDP Growth Forecasts (%YoY) • IMF highlights risks to global growth driven by high inflation, policy tightening and ongoing Ukraine conflict. Global growth CY22F (July 22) CY22F (Oct 22) CY23F (Oct 22) forecast for 2022 unchanged, 2023 reduced to 2.7% (-0.2%). Aggressive Fed tightenin
Slide 15: Global Steel
Global Steel Crude Steel Production – Jan-Aug (mt) Steel Demand (mt) China Steel Production and Export (mt) Jan-Aug CY20 Jan-Aug CY21 Jan-Aug CY22 CY21 CY22F (Apr 22) CY22F (Oct 22) CY23F (Oct 22) China Crude Steel Production (LHS) 150 10 -5.1% -2.3% Exports (RHS) -5.7% -4.3% 8 1,839 -4.0% 100 1,840
Slide 16: Indian Economy
Indian Economy PMI – Manufacturing & Services GST Collection (₹ Lakh Cr) • Normalisation of economy with robust high-frequency indicators. PMI Manufacturing PMI Service 65 1.9 India has one of the highest Manufacturing and Services PMI’s 60 1.7 among major economies. 1.5 55 1.3 • Govt. continues to
Slide 17: Indian Steel
Indian Steel Production and Consumption (mt) Steel Imports (mt) Steel Exports (mt) Q1 FY23 Q2 FY23 Finished Semis Finished Semis QoQ Trend 0.0% +1.6% 30.02 +25.4% -37.5% 30.03 1.54 2.88 27.50 27.93 1.23 0.15 0.69 0.06 1.80 0.39 1.17 1.39 2.19 1.41 Crude Steel Production Apparent Steel Consumption Q1
Slide 18: Agenda
Agenda Sustainability Business Environment Operational Performance Financial Performance Outlook & Project Updates Digitalisation at JSW Steel JSW Steel Q2 FY23 Results Presentation 17
Slide 19: Quarterly Volumes – Standalone
Quarterly Volumes – Standalone Crude Steel Production Steel Sales +21% +32% YoY -1% YoY QoQ +24% QoQ 5.00 4.95 5.01 4.10 4.03 3.79 Q2 FY22 Q1 FY23 Q2 FY23 Q2 FY22 Q1 FY23 Q2 FY23 Q2 FY22 Q1 FY23 Q2 FY23 Q2 FY22 Q1 FY23 Q2 FY23 Flat 2.61 3.03 3.60 Flat 2.79 3.60 3.57 Long 0.95 0.87 1.18 Long 0.92 1.0
Slide 20: Q2 FY23 Volumes – Consolidated India Operations
Q2 FY23 Volumes – Consolidated India Operations Crude Steel Production Total Sales Share of VASP Domestic Sales Export Domestic VASP Other OEM/Industrial Retail Auto Q2 5.63mt 5.07mt 5.57 Q2 FY23 54% 44% 43% 13% 90% FY23 -1% +30% QoQ QoQ 3.45mt Q1 4.33mt Q1 5.62 57% 47% 35% 18% FY23 80% FY23 2.37mt
Slide 21: Retail Segment and Branded Stores Highlights
Retail Segment and Branded Stores Highlights Retail Sales (in kt) Branded Stores (number of outlets) 80% 1,518 QoQ 2,196 97 new branded 217 stores added in new towns and 120 in existing 1387 889 towns 1,222 629 179 785 38 1301 721 387 710 809 591 399 501 Q2 FY22 * Q1 FY23 Q2 FY23 JSW Shoppe JSW Shop
Slide 22: Q2 FY23 Production & Sales Summary
Q2 FY23 Production & Sales Summary In million metric tonnes Q2 FY23 H1 FY23 Crude Steel Crude Steel Particulars Sales Sales Production Production Consolidated Indian Operations 5.57 5.63 11.19 9.96 Joint Control Entity: JSW Ispat Special Products Ltd. 0.03 0.03 0.13 0.16 Indian Operations incl. Join
Slide 23: Grades/Products Approved in Q2 FY23
15 Grades/Products Approved in Q2 FY23 Hot Rolled: High Strength Steel for Auto sub assembly parts Low Carbon Cold Rolled Steel: Bearings Enclosure & Home Appliances Needle Bearing Cage (JIS G3141 SPCC –CRCA) Channel/Drawer slider(SPCC-4D – CRCA) Suspension Control Arms(S700MC & S550MC – HR) Bearing
Slide 24: Grades/Products Approved in Q2 FY23
15 Grades/Products Approved in Q2 FY23 Special Alloy Steel Grade for Auto & OEMs: Color Coated (PPGI) for Home Appliances: Washing Machine Cabinet with Hardening, Casing characteristics & Forging Applications Machining Shaft(SAE8620H – Long Products) Washing Machine Front Load Cabinet(DC04 – Color C
Slide 25: Brand Initiatives and Customer Engagement
Brand Initiatives and Customer Engagement Festive Engagement JSW Roof To Dream CSR initiative • JSW Colouron+ campaign during Onam featuring caricatures of Mollywood characters utilizing OOH, Digital & TV Refurbishing school infrastructure with roofing products: 6 schools refurbished in Gujarat, wit
Slide 26: Agenda
Agenda Sustainability Business Environment Operational Performance Financial Performance Outlook & Project Updates Digitalisation at JSW Steel JSW Steel Q2 FY23 Results Presentation 25
Slide 27: Financials – Standalone
Financials – Standalone ₹ crore Particulars Q2 FY23 Q1 FY23 Q2 FY22 FY22 Revenue from Operations 32,494 31,105 28,000 118,820 Operating EBITDA 1,742 3,352 8,673 31,868 Other Income 422 283 919 1,929 Finance Cost 1,093 1,030 802 3,849 Depreciation 1,207 1,177 1,051 4,511 Exceptional Gain/(Loss) - - -
Slide 28: Operating EBITDA Movement Q2 FY23 – Standalone
Operating EBITDA Movement Q2 FY23 – Standalone ₹ crore 2,628 809 3,352 1,742 (5,047) Q1 FY23 EBITDA Volume Costs NSR Q2 FY23 EBITDA JSW Steel Q2 FY23 Results Presentation 27
Slide 29: JSW Steel Coated Products (Consolidated)
JSW Steel Coated Products (Consolidated) Million tonnes Volumes Q2 FY23 Q1 FY23 Q2 FY22 FY22 Production (GI/GL + Tin) 0.68 0.68 0.75 2.93 Sales 0.79 0.68 0.82 3.22 ₹ crore Key P&L data Q2 FY23 Q1 FY23 Q2 FY22 FY22 Revenue from 6,723 6,891 8,331 31,775 Operations Operating EBITDA (79) (154) 1,032 2,8
Slide 30: Bhushan Power and Steel Ltd (BPSL)
Bhushan Power and Steel Ltd (BPSL) Million tonnes Volumes Q2 FY23 Q1 FY23 Q2 FY22 FY22 Crude Steel Production 0.63 0.61 0.69 1.34 Steel Sales 0.64 0.48 0.76 1.36 ₹ crore Key P&L data Q2 FY23 Q1 FY23 Q2 FY22 FY22 Revenue from 4,805 4,704 6,478 11,208 Operations Operating EBITDA (183) 698 2,022 3,100
Slide 31: Operational Performance – Ohio, USA
Operational Performance – Ohio, USA Net tonnes Operational Q2 FY23 Q1 FY23 Q2 FY22 FY22 Production - Crude Steel 90,709 174,398 168,122 605,657 Sales - Slab 63,614 65,749 73,275 213,175 Sales - HRC 52,862 108,365 89,072 318,493 US$ mn Key P&L data Q2 FY23 Q1 FY23 Q2 FY22 FY22 Revenue from Operations
Slide 32: Operational Performance – US Plate & Pipe Mill
Operational Performance – US Plate & Pipe Mill Net tonnes Production Q2 FY23 Q1 FY23 Q2 FY22 FY22 Plate Mill 77,172 87,213 73,274 292,037 Pipe Mill 4,969 4,658 4,890 12,845 Net tonnes Sales Q2 FY23 Q1 FY23 Q2 FY22 FY22 Plate Mill 74,665 81,788 63,565 266,575 Pipe Mill 4,576 4,663 5,219 12,383 US$ mn
Slide 33: Operational Performance – Piombino, Italy
Operational Performance – Piombino, Italy tonnes Production Q2 FY23 Q1 FY23 Q2 FY22 FY22 Rolled Products (Bars, Wire 65,227 79,558 57,325 319,316 Rod & Rails) Grinding Balls 10,680 16,739 7,269 49,465 tonnes Sales Q2 FY23 Q1 FY23 Q2 FY22 FY22 Rolled Products (Bars, Wire 57,116 72,701 70,142 315,459
Slide 34: Joint Controlled Entity: JSW Ispat Special Products
Joint Controlled Entity: JSW Ispat Special Products Million tonnes Key Metrics Q2 FY23 Q1 FY23 Q2 FY22 FY22 Crude Steel Production (mt) 0.03 0.11 0.13 0.58 Steel Sales (mt) 0.03 0.12 0.14 0.58 ₹ crore Key P&L data Q2 FY23 Q1 FY23 Q2 FY22 FY22 Revenue from Operations 758 1,665 1,437 6,061 Operating E
Slide 35: Financials – Consolidated
Financials – Consolidated ₹ crore Particulars Q2 FY23 Q1 FY23 Q2 FY22 FY22 Revenue from Operations 41,778 38,086 32,503 146,371 Operating EBITDA 1,752 4,309 10,417 39,007 Other Income 188 189 946 1,531 Finance Cost 1,523 1,422 936 4,968 Depreciation 1,805 1,778 1,239 6,001 Share of Profit/ (Loss) of
Slide 36: Q2 FY23 Results – Drivers of Performance (Standalone)
Q2 FY23 Results – Drivers of Performance (Standalone) • Operated at 86% capacity utilization for the standalone operations (incl. Dolvi Phase-II). Iron ore availability issues and maintenance shutdown impacted utilisation levels. Volumes • Sales volumes grew by 24% QoQ driven by higher domestic sale
Slide 37: Net Debt Movement – Consolidated
Net Debt Movement – Consolidated 5,314 ₹ crore 67,221 1,167 65,719 ( 4,481 ) ( 3,502 ) Net Debt Jun'22 New Loan Taken Repayments Forex Impact Movement in Cash Net Debt Sept'22 & Bank Bal. Particulars 30.09.2022 30.06.2022 30.09.2021 Net Debt (₹ Cr) 65,719 67,221 55,394 Cash & cash equivalent (₹ Cr)
Slide 38: Strong Balance Sheet
Strong Balance Sheet Net Gearing (ND/Equity) well Leverage (ND/EBITDA) well under the stated cap of 1.75x under the stated cap of 3.75x Diversified Funding Sources 1.75x 4.50x 1.38x 1.48x 1.34x 3.75x 1.17x 1.04x 2.60x 2.61x 2.70x Bonds and 2.40x Foreign 0.83x INR debt, debentures currency Loans and
Slide 39: Agenda
Agenda Sustainability Business Environment Operational Performance Financial Performance Outlook & Project Updates Digitalisation at JSW Steel JSW Steel Q2 FY23 Results Presentation 38
Slide 40: Key Project Updates - Vijayanagar
Key Project Updates - Vijayanagar 5mtpa brownfield project • Construction activities for all packages underway • Equipment erection commenced for all packages • Project to be completed by FY24 Coke Oven Plant • 1.5 mtpa Coke Oven battery: Battery A commissioned in September 2022. Battery B expected
Slide 41: Key Project Updates – BPSL
Key Project Updates – BPSL Phase-I expansion to 3.5 MTPA • Major facilities completed viz. Sinter Plant 2, VPSA* Oxygen units and modification of EAF, SMS and Casters • Expected ramp-up by Q4 FY23 2nd Filter Press at BPSL Phase-II expansion to 5 MTPA • Long lead-time items ordered (new Wire Rod Mill
Slide 42: Key Project Updates – Downstream
Key Project Updates – Downstream Vasind and Tarapur: Downstream projects • 0.5mtpa Continuous Annealing Line at Vasind o Commissioned in August 2022 • Second Tinplate line of 0.25 mtpa at Tarapur o Commissioned in September 2022 Other Downstream projects • 0.25 MTPA Colour Coating line at Rajpura, P
Slide 43: Agenda
Agenda Sustainability Business Environment Operational Performance Financial Performance Outlook & Project Updates Digitalisation at JSW Steel JSW Steel Q2 FY23 Results Presentation 42
Slide 44: Digitalization: JSW's Approach & Impact Created
Digitalization: JSW’s Approach & Impact Created Wave 4 and Digital Vision-2026* Expand and scale Digital to best-in-class: – Enhance Sales, Marketing, branding, Customer service and eCommerce – Existing plants – Continue digital projects – New plants – ACCIL, JSW-ISPL, JSW- BPSL – Support functions
Slide 45: JSW Steel's Digital Focus Areas
JSW Steel’s Digital Focus Areas AdditionalFocus Technologies Used Core Systems (SAP, SalesForce, Mining Microsoft Azure, DarwinBox), IoT, AI/ML, Analytics, Cloud/Edge Computing, RPA, Intelligent Cameras Safety, Security, Sustainability led Governance R&D Leveraging JSW Digital team, Tech Finance P
Slide 46: JSW Steel's Data Sciences initiatives
JSW Steel’s Data Sciences initiatives (6) Integrated Manufacturing Analytics (1) Process Improvement • Integrated Control Tower (ICT): Persona-based • Raw material blend optimization manufacturing dashboards to provide single- • Defect detection using video analytics view for all plants for the lead
Slide 47: THANK YOU
THANK YOU Investor Relations Contact: ir.jswsteel@jsw.in