Event Update - Divestment of JPL in right direction but issues on funding remains - Downgrade to 'ACCUMULATE'
comes at Rs92bn (Rs27mn/MW), considering present value of preference shares of Rs70.5bn (redeemable after 20 years) at Rs40.5bn, debt transfer of Rs21bn and equity component of Rs30.2bn. Valuation is broadly in line with our estimate. We believe that funding of equity component would be a concern in near term, as it could increase pledging of shares by promoter and may add unwanted risk to the stock. We remain positive on steel sector given the structural supply restrictions in China and improved demand. However, due to limited upside potential, we downgrade JSP to Accumulate with TP of...