Stock Review: Jindal Saw

 

Jindal Saw is likely to take advantage of a revival in demand considering its lower exposure to coal price fluctuations and debt-free operations

   INDUSTRIAL pipe manufacturers have underperformed the broader market in the past one year due to a sluggish recovery in developed economies. However, demand is gradually picking up on the back of higher infrastructure spends by the US and other developed economies and expansions by oil and gas companies following an increase in crude oil prices. This is has boosted the demand for high-grade submerged arc welded (SAW) pipes. In such a situation, future prospects for pipe makers look promising. ET Intelligence Group analyses and compares the performance the country's two leading pipe players — Welspun Corp and Jindal Saw. Our analysis shows that Jindal Saw is better placed given its lower exposure to fluctuations in coal price due to backward integration and almost debt-free operations.