News
JSW Infrastructure (JSWINFRA), India’s second-largest private port operator, continues to strengthen its market presence. With an aggregate capacity of 170MMT as of September 2024, the company has achieved a commendable 22% cargo volume CAGR over FY18-24, significantly outperforming the industry average growth rate of ~4%. Additionally, its ambitious capex plan of INR300 billion aims to ramp up capacity to 400MMT by 2030, including significant brownfield expansions at Jaigarh and Dharamtar ports, set for completion by March 2027. These developments position JSW Infrastructure as a growth leader in the infrastructure sector.
Fundamental Analysis
Key Metrics:
- Market Cap: ₹ 67,683.05 Cr.
- Enterprise Value: ₹ 68,942.09 Cr.
- P/E Ratio: 164.3
- P/B Ratio: 13.71
- Promoter Holding: 85.61%
- ROE: 9.75%
- Profit Growth: 328.22% (YoY)
Strengths:
- Consistent profit growth of 42.63% over the past three years.
- Impressive revenue growth of 18.61% over the past three years.
- High operating margins averaging 45.17% in the last five years.
- Attractive PEG ratio of 0.60, suggesting potential for growth at a reasonable valuation.
Limitations:
- High P/E ratio of 164.30 indicates overvaluation.
- Elevated EV/EBITDA of 84.50.
Financial Ratios:
- Debt-to-Equity Ratio: 0.73 (low leverage)
- Operating Margin: 38.26%
- Dividend Yield: 0.17%
- EPS (TTM): ₹ 1.96
Technical Analysis
The technical chart shows JSW Infrastructure trading at ₹323, up by 4.35%. The stock price is currently above its 9-day EMA (₹316.00), 50-day EMA (₹315.46), and 100-day EMA (₹312.69), indicating bullish momentum. The volume spike to 4.82M suggests increasing investor interest.
Key Levels:
- Resistance: ₹360.95
- Support: ₹297.47
Short-Term Trade Plan
Entry: Buy above ₹325 with a stop-loss at ₹315. Target: ₹340 (short-term resistance).
Rationale: The stock’s bullish momentum supported by strong fundamentals and increased volume makes it a favorable candidate for short-term trading.
Long-Term Trade Setup
Investment Horizon: 1-2 years Target Price: ₹375
Investment Rationale:
- Robust expansion plans to increase capacity from 170MMT to 400MMT by 2030.
- Consistent performance with a projected volume/revenue/EBITDA/APAT CAGR of 14%/19%/20%/19% over FY24-27.
- Growing market share in India’s cargo movement sector.
Conclusion
JSW Infrastructure is a compelling stock for both short-term traders and long-term investors. Its strong fundamentals, aggressive expansion plans, and market leadership position it as a high-potential investment. However, investors should be cautious of the high valuation and monitor execution risks related to its capex plans.
Disclaimer
This blog is for informational purposes only and does not constitute financial advice. Always consult with a qualified financial advisor before making investment decisions. The author is not responsible for any losses incurred based on the information provided here.