JSW Steel share price growth: 28.18% CAGR in the past 5 years, is this stock still worth having

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ABOUT THE COMPANY

JSW Steel Limited is an India’s one of the largest steel producers with domestic sales volume of 19.1 million tonnes. JSW Steel reported a consolidated profit of ₹1,68,824 crore for FY2024–25 with 79% of domestic sales and 21% of exports. The company has collaborated with Japan’s JFE Steel to access advanced technology for high-value steel products. The company has a market capitalization of ₹ 2,84,455 Crores which is highest when compared to its peers like Tata Steel and Jindal Steel. JSW Steel has a production capacity of 28.5 MTPA while its Tata Steel has a production capacity of 34 MTPA and Jindal Steel has a production capacity of 19 MTPA.

Quick peer context:

Company NameMarket CapitalizationReturn On Capital EmployedStock P/E Ratio
JSW Steel₹ 284454.69 Crores8.11 %46.53
Tata Steel₹ 215427.71 Crores    8.83 %  29.30
Jindal Steel₹ 108761.92 Crores10.67 %30.23

Analysis of the Financial Statements

Revenue Growth Trend

The company has shown an extraordinary growth in sales in the past years. Its sales went from Rs 73,326 crores to Rs 168,824 crores from FY20 TO FY25. The same has been reflected through its stock prices, which nearly gave a CAGR of 28.18% in the past 5 years. The robust order book of the company and more than 80% of them being repeat customers shows us strong revenue visibility and the same for its stock prices.

March 2020March 2021March 2022March 2023March 2024March 2025
73,326 CRORES79,839 CRORES146,371 CRORES165,960 CRORES175,006 CRORES168,824 CRORES

Profitability & Margin Analysis

Operating Profit Margin of the company has shown a decrease from 16% to 13% in the past 5 years, showing the management inefficiency is controlling the cost, but while comparing its OPM with its peers it indicates that it has made profits. Tata Steel has a OPM of 12% in FY25 while Jindal Steel OPM is 11.4% in FY25.

March 2020March 2021March 2022March 2023March 2024March 2025
16%25%27%11%16%13%

Balance Sheet Strength

Total Assets of the company have shown an increase from Rs 131,820 crores to Rs 250,435 crores in the past 5 years. Much of this increase is due to the investments made by the company in its fixed assets for increasing its manufacturing capacity which will help the company to grab better opportunities in the future and make better profits. Management has made subsequent investments being Rs 1,259 crore in 2020 to Rs 15,606 crore in 2025.

March 2020March 2021March 2022March 2023March 2024March 2025
131,820CRORES148,317 CRORES196,485 CRORES210,539 CRORES227,898 CRORES240,445 CRORES

Debt Profile

Company has increased its debt in the past 5 years from RS 61,423 crores in March 2020 to Rs 98,752 crores in March 2025 which is acceptable for such an industry. Reserves of the company have nearly multiplied 2.5 times in the past 5 years, which is the sign that the company is ready for capital investments when larger opportunities come in the way. Reserves and Surplus:

March 2020March 2021March 2022March 2023March 2024March 2025
36,298 CRORES46,462 CRORES66,996 CRORES65,394 CRORES77,364 CRORES79,191 CRORES

Cash Flow Health

The Cash from Operating Activity has remained positive throughout the years and been growing at a steady phase, a very constructive sign for a company in investment phase. The cash conversion cycle of the company is 28 days, which is good for such industry. The cash generated and the cash conversion cycle is a critical indicator of a healthy business model that generates real cash from its core activities.

Comparative Data with Key Competitors (Tata Steel, Jindal Steel & Power)

Parameter  JSW SteelTata SteelJindal Steel & Power
Sales Growth (5-Yr CAGR)  15%17%13%
Operating Profit Margin  13% (Compressed)22% (Compressed)18% (Compressed)
Debt-to-Equity  0.70 (Medium)0.53 (Low)0.68 (Low)

Disclaimer: The article is for informational purposes only and not investment advice. 

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