JSPL - An Alternate Deal Contour Can Draw Better Acceptance: ICICI Securities
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ICICI Securities Report
Jindal Steel and Power Ltd. has announced sale of its 96.42% stake in Jindal Power Ltd. to a promoter entity Worldone.
The equity value (all-cash) for the offer is Rs 30.15 billion. Objectives are:
Deleveraging the balance sheet, to prepare for next phase of steel capex, i.e. increasing Angul capacity from six million tonne per annum to 12mtpa; and
Meet the environmental social governance objective of the company being in the top-10 lowest carbon-di-oxide emitting steel companies globally.
There are concerns that we could gather from our investor interaction on the implied enterprise value of the deal.
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