Investment Analysis:

- Steel volumes to increase 30% q-o-q: Motilal Oswal expect JSP's standalone net sales to increase 40% y-o-y (up 16% q-o-q) to Rs38.4b on liquidation of inventory accumulated during the previous quarter. They expect steel sales volume to increase 30% q-o-q to 770k tons. Long product prices have increased 5% q-o-q; this would benefit the company over other steel producers that have mainly flat product portfolios. JSP's 4.5mtpa pellet plant is ramping up well and Motilal Oswal expect it to sell 516k tons in 4QFY12. Power sales are likely to increase 43% y-o-y to 427m units. Power sales volumes at JPL are likely to decline marginally by 2% q-o-q to 2b units, while the average rate is likely to increase 1% y-o-y to Rs4/unit.

- EBITDA to increase 29% q-o-q: Motilal Oswal expect standalone EBITDA to increase 29% q-o-q to Rs13.4b due to higher steel prices and better steel, metalics, pellet and power sales volumes. Standalone other income is expected to increase to Rs1.5b from Rs0.2b on account of a dividend payout from Jindal Power.

- Maintain Buy: Motilal Oswal remain positive on JSP's long-term growth outlook. The company would be augmenting its steel-making capacity by 4 times over the next four years and power generation capacity by 10 times over 10 years. The stock trades at 9.8 times FY14E EPS, 1.9 times FY14E BV, and an EV of 7.7 times FY14E EBITDA. Maintain Buy.