Jindal Steel & Power Slips to Loss in Q4 Amid Exceptional Charges

Jindal Steel & Power Ltd. (JSPL) reported a consolidated net loss of ₹339.4 crore for the quarter ended March 31, 2025, a significant reversal from the net profit of ₹935.4 crore recorded in the corresponding period of the previous year. 

Key Financial Highlights

The company suffered an exceptional loss of ₹1,229.5 crore during the quarter. This substantial charge included several components related to overseas subsidiaries.

An impairment provision of ₹1,091.6 crore for mining assets classified under intangible assets at Wollongong Resources Pty., an overseas subsidiary in Australia.

Impairment provisions totalling ₹26.4 crore (₹13.5 crore and ₹12.9 crore) for mining assets under development in two subsidiaries located in Madagascar, Jindal Madagascar SARL and Osho Madagascar SARL.

An expected credit loss allowance of ₹111.5 crore made for certain loans and advances in Jindal Steel & Power (Mauritius) Ltd., another overseas subsidiary.

Beyond the bottom line, JSPL's operational performance also saw a slight contraction. Revenue for Q4 FY25 decreased by 2.3% year-on-year, coming in at ₹13,183.1 crore compared to ₹13,487 crore in the year-ago period. Earnings Before Interest, Taxes, Depreciation, and Amortisation (EBITDA) declined by 7% to ₹2,270.8 crore from ₹2,444.5 crore in Q4 FY24. This resulted in a narrower EBITDA margin, which compressed to 17.2% from 18.1% a year earlier. 

Dividend Proposal and Market Reaction

Despite the net loss for the quarter, the board of Jindal Steel proposed a dividend of ₹2 per share, with a face value of ₹1 each, for the financial year ended March 31, 2025. The proposed dividend is contingent on approval from the company's members at the annual general meeting.

Market Performance

On the day of the results announcement, shares of Jindal Steel closed at ₹892.50 apiece on the NSE. Over the past 12 months, the stock has seen a decline of 3.66%,with a year-to-date fall of 3.77%. 

The Q4 results underscore the impact of non-operational charges on the steelmaker's profitability, overshadowing the slight dip in core operational metrics compared to the exceptional losses incurred from its overseas assets.

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