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JSW ISPAT LTD

COMPARISION BETWEEN JSW & ISPAT

Akshat Devpura

30/04/2012

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ISPAT

Nippon Denro Ispat Limited was incorporated in 1984 and was granted the first IndustrialLicense by Government of India for manufacturing Galvanized Plain/Corrugated Sheets

Major units

1. Integrated Steel Plant at Dolvi, Maharashtra The Dolvi complex has a captive port located

close to it on the Amba River, which opens into the Arabian Sea. This port can handle barges and

mini-bulk carriers up to 4000 dry weight tonnage (DWT). Moreover, a jetty adjoining the

complex is capable of handling cargo of up to 10 million tonnes per annum.

Manufacturing Facilities:o DRI - Sponge Iron Planto Blast Furnaceo Compact Strip Production

2. Integrated Steel Plant at Kalmeshwar, Maharashtra The integrated steel plant at Kalmeshwar

uses the latest steel manufacturing technology to produce galvanized sheets and products, apart

from cold rolled coils. The Kalmeshwar complex houses a total of three advanced plants - a

0.325 million tonnes Galvanized Plain/Galvanized Corrugated plant, a 0.33 million tonne Cold

Rolled Coils plant and a 60,000 tonne Colour Coated Sheets plant.

Manufacturing Facilitieso Cold rolling millo Galvanizing lineo Colour coating line

TAKEOVER

On 21 December 2010 it was declared that JSW Steel will buy controlling interest in Ispat

Industries at an enterprise value of $3 billion to emerge as India's largest producer of the

commodity with an annual capacity of 14.3 million tonnes. The company will now be called

JSW Ispat Steel Ltd

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FINANCIALS

JSW ISPAT Steel

Profit & Loss account ------------------- in Rs. Cr. -------------------

Jun '11 Jun '10 Mar '09 Mar '08 Mar '07

12 mths 15 mths 12 mths 12 mths 12 mths

Income

Sales Turnover 9,100.50 11,079.40 9,181.29 9,478.75 8,417.56

Excise Duty 770.14 879.95 917.28 1,116.56 889.80Net Sales 8,330.36 10,199.45 8,264.01 8,362.19 7,527.76

Other Income -1,095.88 180.91 -391.74 580.29 79.25

Stock Adjustments 93.07 267.20 -105.05 -159.16 28.13

Total Income 7,327.55 10,647.56 7,767.22 8,783.32 7,635.14

Expenditure

Raw Materials 5,962.38 6,411.62 5,022.01 4,936.42 4,123.47

Power & Fuel Cost 1,400.97 1,823.73 1,289.81 1,250.41 1,153.52

Employee Cost 234.81 273.36 207.60 202.60 165.34

Other Manufacturing Expenses 152.48 172.01 149.20 145.95 110.75

Selling and Admin Expenses 305.74 342.78 310.14 324.25 339.20

Miscellaneous Expenses 51.96 70.93 57.50 73.51 64.80

Preoperative Exp Capitalised -1.47 -2.33 0.00 0.00 0.00

Total Expenses 8,106.87 9,092.10 7,036.26 6,933.14 5,957.08

Jun '11 Jun '10 Mar '09 Mar '08 Mar '07

12 mths 15 mths 12 mths 12 mths 12 mths

Operating Profit 316.56 1,374.55 1,122.70 1,269.89 1,598.81

PBDIT -779.32 1,555.46 730.96 1,850.18 1,678.06

Interest 1,015.60 1,369.98 1,129.74 1,108.09 1,099.62

PBDT -1,794.92 185.48 -398.78 742.09 578.44

Depreciation 596.26 773.95 646.62 638.12 623.83

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Other Written Off 2.08 3.47 2.47 0.00 0.00

Profit Before Tax -2,393.26 -591.94 -1,047.87 103.97 -45.39

Extra-ordinary items 23.11 10.52 23.98 11.65 38.55

PBT (Post Extra-ord Items) -2,370.15 -581.42 -1,023.89 115.62 -6.84

Tax -564.27 -259.08 -335.78 80.82 12.90

Reported Net Profit -1,805.88 -322.34 -688.11 34.80 -9.53

Total Value Addition 2,144.49 2,680.48 2,014.25 1,996.72 1,833.61

Preference Dividend 0.00 0.00 0.00 0.00 0.00

Equity Dividend 0.00 0.00 0.00 0.00 0.00

Corporate Dividend Tax 0.00 0.00 0.00 0.00 0.00

Per share data (annualised)

Shares in issue (lakhs) 23,867.99 12,224.42 12,224.42 12,224.42 12,224.42

Earning Per Share (Rs) -7.57 -2.64 -5.63 0.28 -0.08

Equity Dividend (%) 0.00 0.00 0.00 0.00 0.00

Book Value (Rs) 0.09 -3.34 -1.16 5.54 5.16

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JSW STEEL

JSW Steel Ltd. is an Indian steel company owned by the JSW Group based in Mumbai, Maharashtra.[2]

JSW Steel is among India's largest steel producers, with a capacity of 10 MT as of 2011

Facilities

Vijayanagar Works

Vijaynagar works was the first Greenfield project in world to use Corex technology to produce

steel. On February 18, 2009 India largest Blast Furnace of 2.8MT capacity was commissioned

here. With this commissioning, JSW Steel become the largest private sector steel producer in

India with 7.8MT capacity. It is also in the advance stage of setting up of 5MTPA state of the act

Hot Strip Mill which will be commissioned in the second half of fiscal 2009-10. The next phase

of expansion taking the total production to 10mtpa plant at Vijayanagar Works is also under

implementation. It will be commissioned in fiscal 2010-11. This makes it among the fastest

growing steel plant in the world.

It's eco-friendly approach has also led to the development of Vijayanagar into a modern

township. Enveloped by acres of greenery and maintained by JSW, Vijayanagar is prospering by

leaps and bounds. Be it education, career opportunity or women empowerment, the Company's

initiative has gone a long way in making Vijayanagar the success that it is today. Vasind and

Tarapur Works

It is here that all began. A new chapter was written in the history of Indian Steel Industry whenJSW made its foray at Vasind in 1982 and setup a 20 Hi CR mill. JSW then acquired a mini steel

mill, which moved on to become JSW Steel Ltd.

Apart from being a leading manufacturer of cold rolled and color coated steel, Tarapur and

Vasind works is today Indias biggest producer & largest exporter of galvanized steel. At Vasind

Works, the Company has recently launched GALVALUME, a revolutionary product in the steel

industry. Its strategic location, with access to the major ports of Mumbai, markets and raw

material sources has worked to its advantage.

The total capacity of Vasind and Tarapur Works is 0.9 MTPA of Galvanised, GALVALUME &Colour Coated Cold Rolled products.

As JSW grew phenomenally, it also steered Tarapur and Vasind towards newer horizon of

prosperity. Apart from providing more jobs, JSW actively participates and organizes various

social and cultural activities to make lives richer. The region is now cleaner happier and even

http://en.wikipedia.org/wiki/JSW_Steel#cite_note-1http://en.wikipedia.org/wiki/JSW_Steel#cite_note-1http://en.wikipedia.org/wiki/JSW_Steel#cite_note-1http://en.wikipedia.org/wiki/JSW_Steel#cite_note-1

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more beautiful. Better health initiative, promotion of sports & education are few of the

development initiative that has gained in JSW presence Salem Works

JSW group acquired the Company and took over the Management from November 2004. Salem

Works is the only integrated steel plant in Tamil Nadu and is located at Pottaneri/M. Kalipatti

villages and at about 35 km northwest from Salem.

As part of the JSW group, the plant underwent a dramatic transformation and started making

profits from the first year onwards. Today, it has become the first 1 MTPA integrated steel plant

in Tamil Nadu.

The Company is having facilities for production of Pig Iron, Steel, Billet and Rolled Steel

products in the long product category. The present capacity is being expanded to one million

tones per annum. It has adopted the Sinter plantBlast furnaceEnergy Optimising Furnace

Ladle Furnace, Vacuum Degassing Continuous Casting Machinebar and rod mill route with

iron ore as the basic input material. It also has plants for generation of power and production of

oxygen.

Salem Works is highly environment conscious and the process and technology is designed for

reusing and recycling the process waste. We have an expanding green belt to provide a green

environment.

Products of Salem Works have the hallmark of quality and combined with competitive pricing,

they are highly preferred in automobile and construction sectors.

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PRODUCTS

Hot Rolled Coils & Sheets

Hot Rolled Plates

Cold Rolled Closed Annealed Coils & Sheets

Galvanised Coils & Sheets

JSW Vishwas G.C. Sheets

Galvalume Coils and Sheets

JSW Vishwas Plus G.C. Sheets

JSW Pragati Colour Coated Sheets

Pre-Painted Products

JSW TMT Plus Bars

Wire Rods & Special Steel - RCS, Rounds & Spring Steel Flats

http://www.jsw.in/companies/JSWSteel_product_hot_rolled.shtmlhttp://www.jsw.in/companies/JSWSteel_product_hot_rolled_plates.shtmlhttp://www.jsw.in/companies/JSWSteel_product_cold_rolled.shtmlhttp://www.jsw.in/companies/JSWSteel_product_galvanised.shtmlhttp://www.jsw.in/companies/JSWSteel_product_jsw_vishwas.shtmlhttp://www.jsw.in/companies/JSWSteel_product_galvalume_coils_sheets.shtmlhttp://www.jsw.in/companies/JSWSteel_product_galvalume_coils_sheets.shtmlhttp://www.jsw.in/companies/JSWSteel_product_jsw_vishwas_plus.shtmlhttp://www.jsw.in/companies/JSWSteel_product_jsw_pragati_CCS.shtmlhttp://www.jsw.in/companies/JSWSteel_product_pre_painted.shtmlhttp://www.jsw.in/companies/JSWSteel_product_tmt_plus.shtmlhttp://www.jsw.in/companies/JSWSteel_product_wire_rods.shtmlhttp://www.jsw.in/companies/JSWSteel_product_wire_rods.shtmlhttp://www.jsw.in/companies/JSWSteel_product_tmt_plus.shtmlhttp://www.jsw.in/companies/JSWSteel_product_pre_painted.shtmlhttp://www.jsw.in/companies/JSWSteel_product_jsw_pragati_CCS.shtmlhttp://www.jsw.in/companies/JSWSteel_product_jsw_vishwas_plus.shtmlhttp://www.jsw.in/companies/JSWSteel_product_galvalume_coils_sheets.shtmlhttp://www.jsw.in/companies/JSWSteel_product_jsw_vishwas.shtmlhttp://www.jsw.in/companies/JSWSteel_product_galvanised.shtmlhttp://www.jsw.in/companies/JSWSteel_product_cold_rolled.shtmlhttp://www.jsw.in/companies/JSWSteel_product_hot_rolled_plates.shtmlhttp://www.jsw.in/companies/JSWSteel_product_hot_rolled.shtml

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FINANCIALS

JSW Steel

Profit & Loss account ------------------- in Rs. Cr. -------------------

Mar '11 Mar '10 Mar '09 Mar '08 Mar '07

12 mths 12 mths 12 mths 12 mths 12 mths

Income

Sales Turnover 25,130.76 19,456.64 15,179.29 12,628.91 9,337.34

Excise Duty 2,031.91 1,289.18 1,172.70 1,237.86 742.31

Net Sales 23,098.85 18,167.46 14,006.59 11,391.05 8,595.03

Other Income 199.05 474.25 -608.47 309.91 110.60

Stock Adjustments 747.37 64.74 285.22 283.56 -66.54

Total Income 24,045.27 18,706.45 13,683.34 11,984.52 8,639.09

Expenditure

Raw Materials 15,995.19 11,415.86 9,386.47 6,560.14 4,377.23

Power & Fuel Cost 1,181.52 1,014.82 673.07 532.43 393.10

Employee Cost 534.47 365.20 288.75 273.98 175.47

Other Manufacturing Expenses 476.58 299.18 194.03 165.58 87.84

Selling and Admin Expenses 819.68 724.63 717.74 639.26 572.82

Miscellaneous Expenses 200.40 138.95 170.58 146.99 103.39

Preoperative Exp Capitalised 0.00 0.00 0.00 0.00 0.00

Total Expenses 19,207.84 13,958.64 11,430.64 8,318.38 5,709.85

Mar '11 Mar '10 Mar '09 Mar '08 Mar '07

12 mths 12 mths 12 mths 12 mths 12 mths

Operating Profit 4,638.38 4,273.56 2,861.17 3,356.23 2,818.64

PBDIT 4,837.43 4,747.81 2,252.70 3,666.14 2,929.24

Interest 850.92 900.26 836.82 494.84 406.81

PBDT 3,986.51 3,847.55 1,415.88 3,171.30 2,522.43

Depreciation 1,378.71 1,123.41 827.66 687.18 498.23

Other Written Off 0.00 0.00 0.00 0.00 109.02

Profit Before Tax 2,607.80 2,724.14 588.22 2,484.12 1,915.18

Extra-ordinary items 161.89 96.03 176.80 -33.16 16.15

PBT (Post Extra-ord Items) 2,769.69 2,820.17 765.02 2,450.96 1,931.33

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Tax 759.02 797.43 306.52 722.77 639.33

Reported Net Profit 2,010.67 2,022.74 458.50 1,728.19 1,292.00

Total Value Addition 3,212.65 2,542.78 2,044.17 1,758.24 1,332.62

Preference Dividend 27.90 28.92 28.99 29.06 27.90

Equity Dividend 273.32 177.70 18.71 261.87 204.98

Corporate Dividend Tax 48.87 34.31 8.11 49.44 33.49

Per share data (annualised)

Shares in issue (lakhs) 2,231.17 1,870.49 1,870.49 1,870.49 1,639.79

Earning Per Share (Rs) 88.87 106.59 22.96 90.84 77.09

Equity Dividend (%) 122.50 95.00 10.00 140.00 125.00

Book Value (Rs) 735.80 504.00 410.07 394.99 322.80

MERGER

JSW Steel Ltd has pumped in Rs 2,157 crore in JISL by way of subscription of equity shares in

JISL. JSW Steel also had, through an open offer, further acquired 8,99,40,890 shares, enabling it

to takeover management control of the company. The infusion of funds by JSW Steel has

enabled JISL to meet its long-term working capital requirements and achieve savings in interestcosts, the directors of JISL said in their annual report for 2010-11.

Gas-based power plant

The company said that to ensure regular supply of power and save costs, a gas-based power plantof 55 MW capacity using waste gas being generated by the blast furnace as feed-mix has beenproposed at a cost of about Rs 155 crore.

The project is expected to be commissioned in 18 months. A second colour coating line at itsKalmeshwar complex on an investment of Rs 40 crore has been proposed. Significantly, all theseprojects of JISL are to be financed through internal accruals.

With a view to ensuring raw material integration and save input costs, JSW Steel plans to set upa coke oven plant of 1 million tonnes per annum capacity and a pellet plant of 4 mtpa capacity atthe Dolvi steel complex. This would protect JISL from market risks in sourcing quality coke andpellets for its steel-making operations.

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The coke oven and pellet projects are likely to be commissioned in 24 months and 21 months,respectively. However, the investment outlay for both the projects was not specified.

Cold-rolling facility

JSW Steel Ltd has also proposed to establish a 0.8 million tpa cold-rolling facility at the Dolvisteel complex to augment JISLs efforts to capture downstream opportunities.

The project is expected to cost around Rs 300 crore and is likely to be commissioned within 18months.

For treating one of the units (300 MW) of JSW Energy Ltd at Ratnagiri, Maharashtra, as acaptive unit for supply of power, the company has invested Rs 163.29 crore in the shares of JSWEnergy Ltd and will enter into an Energy Wheeling Agreement for long term power supply.