Sajjan Jindal, aged 63 years, is the Chairman and Non-Executive Director and the Individual Promoter of the Company. He holds a bachelor’s degree in mechanical engineering from Bangalore University. He has been associated with JSW Steel Limited as its managing director since 1997 and is currently the chairperson and managing director of JSW Steel Limited. He is the vice chairman of the World Steel Association and is also on the board of directors of JSW Energy Limited. He was previously associated as a director with JSW Bengal Steel Limited, National Skill Development Corporation and The Associated Chambers of Commerce and Industry of India. He has over 36 years of experience in the manufacturing and steel industry. He is a recipient of the EY Entrepreneur of the Year 2022 award, Business Standard CEO of the Year award in 2018 and the IIM JRD Tata award for Excellence in Corporate leadership in Metallurgical Industries, 2017. Nirmal Kumar Jain, aged 77 years, is the Vice Chairman and Independent Director of the Company. He holds a bachelors’ degree in commerce from Jiwaji University, Gwalior. He has passed the final examination held by the Institute of Chartered Accountants of India and has passed the final examination held by the Institute of Company Secretaries in India. He joined Jindal Iron & Steel Company Limited in 1992 as general manager – finance. He has over 21 years of experience in the financial services sector. Arun Sitaram Maheshwari, aged 53 years, is the Joint Managing Director and Chief Executive Officer of the Company. He holds a bachelors’ degree in commerce from Ajmer University. He has passed the final examination of master of business administration held by Mohanlal Sukhadia University, Udaipur. He has previously been associated with Jindal Strips Limited, Jindal Iron & Steel Company Limited and Jindal Vijaynagar Steel Limited. He has over 30 years of experience in the areas of marketing, import (raw materials), corporate strategy and infrastructure. He has been associated with the Company since April 18, 2019.

A. Balance Sheet

Particular (In Million)	Mar-21	Mar-22	Mar-23	3MFY24
Equity Share Capital	599.29	599.29	3,595.75	3,595.75
Reserves	28,312	32,122	36,351	39,465
Borrowings	39,458	44,087	42,437	42,284
Trade Payables	2,151	2,748	3,016	2,596
Other Liabilities	12,024	14,739	9,107	8,375
Total Liabilities	53,634	61,573	54,560	53,255
Net Block	33,189	34,262	34,216	33,766
Capital Work in Progress	2,921	701	450	540
Investments	2,955	2,830	25	29
Other Assets	29,455	33,139	31,913	31,709
Total NC Assets	68,520	70,932	66,604	66,044
Receivables	4,818	6,013	4,024	3,901
Inventory	991	854	1,022	1,025
Cash & Bank	2,648	10,382	16,316	17,432
Other Assets	5,568	6,113	6,540	7,914
Face value	2	2	2	2

B. Profit & Loss Statement

Particular (In Million)	Mar-21	Mar-22	Mar-23	3MFY24
Sales	16,036	22,731	31,947	8,781
Raw Material Cost	5,746	8,582	12,066	3,212
Employee Cost	1,114	1,497	2,300	727
Other Expenses	1,012	1,558	1,380	329
Other Income	747	1,057	1,781	401
EBITDA	8,911	12,151	17,983	4,915
EBITDA Margin	55.57%	53.46%	56.29%	55.97%
Depreciation	2,707	3,695	3,912	947
Interest	2,279	4,196	5,961	-158
Profit before tax	3,926	4,260	8,110	4,125
Tax	1,080	955	615	903
Net profit	2,846	3,304	7,495	3,222
NPM (%)	16.96%	13.89%	22.22%	35.09%

C. Cash Flow Statement

Particular (In Million)	Mar-21	Mar-22	Mar-23	3MFY24
Cash From Operating Activity
Profit From Operation	8,731	11,908	17,827	4,970
Receivable	907	-1,195	1,990	122
Inventory	260	137	-168	-3
Payable	568	597	268	-420
Other WC Items	97	1,539	-138	-586
Working Capital Changes	1,832	1,077	1,952	-886
Direct Taxes	-661	-1222	-1807	-440
Net Cash Inflow from Operating Activity	9902	11762	17972	3645
Cash from Investing Activity
Fixed assets purchased	-17,226	-5,091	-2,794	-576
Fixed assets sold	1,301	23	103	0
Investments purchased	-332	0	-3,972	-1,995
Investment sold	1,151	125	3,775	402
Inter-corporate deposits	-1,576	-3,602	-5,035	-1,229
Other investing items	314	532	1,715	193
Net cash inflow from investing activities	-16,368	-8,013	-6,208	-3,205
Cash from Financing Activity
Proceeds from borrowings	13,435	35,108	679	150
Repayment of borrowings	-4,553	-31,200	-5,733	-227
Intrest paid fin	-2,249	-3,621	-2,727	-217
Other financing items	-224	-262	-3,085	-260
Net Cash Flow	-58	3,775	899	-113

 

Name of the Company	Revenue (In Crore)	PAT (In Crore)	EPS ( in Rs)	P/E	CMP	Mcap (In Crore)
JSW Infrastructure Limited	3195	750	3.57	33.3	119	24,990
Adani Ports & Special Economic Zone Ltd	20852	5,393	24.58	24.3	831	1,79,562

*  All the data is as per FY23.

Review And Recommendation of JSW Infrastructure IPO by IZ team is 6/10

A) Importance of the Port Industry

1. Gateway to Trade: Ports are a critical entry and exit point for international trade, which forms the backbone of any strong economy. 2. Supply Chain: Ports are integral to logistics and supply chain management, influencing various industries like manufacturing, import-export, and even retail. 3. Growth Indicator: Investment in port infrastructure often correlates with economic growth, making it a valuable sector to consider.

B) Why JSW Infrastructure?

1. Diversification: With nine Port Concessions across India, the company has a diverse range of services, including cargo handling and storage solutions, making it resilient against market downturns in specific segments. 2. Strategic Locations: The ports are situated near industrial zones and have good connectivity, increasing their utility and reducing logistical costs. 3. Long-term Revenue Visibility: The company's long concession periods (average of 25 years) provide stability and visibility of revenue streams. 4. High Growth: Being the fastest-growing port-related infrastructure company in India, it has solid momentum that can be expected to continue. 5. Alignment with JSW Group: Given that the ports are closely located to other JSW Group ventures, there's a built-in customer base that assures a minimum level of demand.

Financial Health

1. Revenue in FY21: ₹1,603.6 Crore increased to ₹3,195 Crore. Indicating a strong growth. 2. Strong EBITDA Margins: At 56.29%, the high EBITDA margin indicates operational efficiency. 3. Net Profit Margins: A 22.22% net profit margin signifies a good bottom line after all expenses, indicative of strong management and operational capabilities. The PAT has also increased from INR 284 Cr in Fy21 to INR 750 Cr in Fy23. 4. In the last 3 years, the company has generated a cash of ~4000 Cr from operations. 5. Debt Management: The IPO aims to repay a portion of its borrowings, which would strengthen its balance sheet.

Use of Funds

1. Debt Repayment: A significant part of the proceeds will be used to repay debt, which will improve the company's leverage ratios. 2. Expansion Plans: Investment in new terminals and upgrading existing ones ensures that the company is preparing for future demand.

Valuation

1. P/E Ratio: At 33.3, the P/E ratio is higher than its closest peer (Adani Ports at 24.3), which indicates higher growth expectations from the market. 2. EPS: An EPS of ₹3.57 shows profitability on a per-share basis, making it attractive for investors.

Risks

1. Competition: The port sector has fierce competition, including well-established players like Adani Ports. 2. Regulatory Risks: Being a part of the infrastructure sector, it is subject to various regulatory guidelines which can impact business.

Conclusion

Investing in JSW Infrastructure offers a blend of stability and growth. It has a diversified and strategically located asset base, strong financials, and plans for expansion funded by the IPO. While there are inherent risks associated with the port industry and competition, the company's fundamentals and growth trajectory make it a compelling investment opportunity.

JSW Infrastructure Limited JSW Centre, Bandra Kurla Complex Bandra (East), Mumbai - 400 051 Phone: +91 22 4286 1000 Email: infra.secretarial@ jsw.in Website: https://www.jsw.in/infrastructure