Motilal Oswal: JSW Steel Focused On Navigating Choppy Waters
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Motilal Oswal Report
Higher exports and cash conservation to help tide over weak demand. JSW Steel’s FY20 Annual Report highlights the company’s strategy to combat the fallout of Covid-19. JSTL plans to ramp-up exports to 30% of sales (verses 21% in FY20 and 16% in FY19) to compensate for weak demand in the domestic market. Even in FY20, domestic volumes fell 10.7% YoY, which was partly compensated through higher exports, with overall sales volumes declining 4% YoY.
JSTL is planning targeted cost savings, supported by technology and digitalization, to reduce the cost base across areas of operation. Employee costs have already been cut, with FY21 likely to see flat manpower costs despite the new capacity at Dolvi.
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