Jindal Saw (JINDALSAW)

FairStock Score: 74/100 — STEADY

Score breakdown: P/E: 3/3 · ROCE: 1/2 · Growth: 0/2 · Dividend: 0/1

Key Financials

Strengths

• P/E of 10.54 and P/B of 1.37 are moderate, with book value at ₹178.43.
• ROCE of 19.37% is respectable, showing operating capital efficiency.
• Free cash flow of ₹1,438 Cr provides genuine cash generation despite the downturn.
• Promoter holding of 63.25% aligns management interest with minority shareholders.
• 5-year revenue CAGR of 14.33% shows prior demand expansion.

Concerns

• Sales down 14.26% and profit down 42.20% indicate a sharp cyclical slowdown.
• DCF intrinsic value of ₹18.85 is far below the market price, questioning valuation support.
• EV/EBITDA of 136.32 is extremely high, suggesting earnings-based valuation is not cheap.
• Altman Z-Score of 2.17 is in the grey zone, warranting balance sheet caution.

AI Analysis

At ₹245, Jindal Saw looks cheap on the surface—P/E of 10.54 and P/B of 1.37 against book value of ₹178.43. But Graham taught me that cheapness in a cyclical business can be an illusion. Sales are down 14.26% and profits have fallen 42.20%; the latest quarter’s ₹248 Cr profit on ₹4,943 Cr sales is a thin margin. The 5-year revenue CAGR of 14.33% shows past growth, but the current decline tells me steel is in a down part of its cycle. ROCE at 19.37% is decent, yet ROE is only 9.86%, and with debt/equity at 0.43, leverage is manageable but not zero. Free cash flow of ₹1,438 Cr is genuinely positive—that is real money owners can use. Promoter holding of 63.25% is reassuring, and the Piotroski F-Score of 6 suggests the financial position is not deteriorating badly. Still, I cannot ignore the DCF figure of ₹18.85. If that is even roughly right, the market is pricing in a recovery far beyond conservative intrinsic worth. Graham Number of ₹265.74 points to asset value, but Altman Z-Score of 2.17 sits in the grey zone, and EV/EBITDA of 136.32 is a serious red flag that earnings-based valuation is not as cheap as the P/E makes it look. Dividend yield of 1.08% gives me little income protection while I wait. This is a cyclical, not a growing franchise. I want a margin of safety over the cycle, not just over book value. If earnings keep falling, a 10 P/E can become a 15 or 20 P/E with lower profits. I would keep this on my watchlist and wait for evidence of demand recovery or a meaningfully lower price.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer