Jindal Stainless joins hands with Indian Railways for Rail Infrastructure Modernisation

Fitch’s India Ratings and Research assigns ‘IND BBB’ to Jindal Stainless Limited with stable outlook

NEW DELHI: The Jindal Stainless on Thursday partnered with Research Designs & Standards Organisation (RDSO) in the third edition of InnoRail India 2018 here.

With a 60 per cent market share in the coach segment, Jindal Stainless has joined hands with the Railways for additionally modernizing rail infrastructure, particularly in the bridge segment. Speaking to media on the sidelines of InnoRail, Jindal Stainless Sales head Vijay Sharma said.

“As a progressive organization, RDSO keeps innovating ways and means to build safe and sustainable infrastructure. Stainless steel coaches and foot-over-bridges validate their movement in this direction. Jindal Stainless is proud to partner their journey by expediting conversion of coaches into stainless steel and strengthening rail infrastructure at the same time.”

Over the next 4-5 years, Railways plans to produce around 10,000 stainless steel coaches annually.

India has a coastline of 7500 km which necessitates the use of stainless steel infrastructure. High air-borne salts in marine environments cause rapid corrosion and degradation of infrastructure. Bridges, especially in these areas, are exposed to severe risk of collapse. As per industry data, around 1,35,000 rail bridges exist in India, of which over 25 per cent are over 100 years old and need immediate replacement. The first such stainless steel foot-over-bridge is coming at Bhayandar station in Mumbai next year. Though more than 1000 bridges are rehabilitated every year, there is a huge backlog in rebuilding these bridges.

The stainless steel material for wagons and coaches produced by Jindal Stainless is already tested and approved by RDSO, the highest advisory body to the Indian Railways. Apart from supply of stainless steel to Railways, Jindal Stainless also organizes fabrication training programmes at Integral Coach Factories to enhance their output. Other than the conventional coaches which are made out of carbon steel, both, LHB (Linke Hofmann Busch) and suburban coaches are shifting towards stainless steel.

This shift towards stainless steel, undertaken by Railways, is an initiative in augmenting passenger safety, optimizing lifecycle costs, and building sustainable infrastructure. Stainless steel has high impact resistance, does not get deformed, and can absorb more energy during collision. This prevents loss of life during accidents and mishap. Easy design, fabrication, and reduced life cycle cost give stainless steel an edge over any other metal. Additionally, the inherent properties of corrosion resistance, fire resistance, high strength-to-weight ratio, easy weldability, and speed of construction make stainless steel an ideal choice for coaches and railway infrastructure.

Manufacturing India’s Longest Rails

Failure in railway tracks due to fracture of welded joints of rails is one of the largest causes of accidents due to derailments. Using long rails increase the sustainability of railway infrastructure and mitigate accidents and loss of life.

For this reason JSPL has innovated to manufacture the longest rails in India. The country’s longest rail length of 121 metres is being rolled at JSPL’s Raigarh manufacturing plant site. In the plant site itself these rails can be further welded together to create 484 meter long rails that are then transported to the rail track location.

Further strict chemical composition control and reduction of dissolved gases to very low ppm levels produces superior quality steel of Head Hardened Grade (Grade 1080) suitable for the rolling of our rail tracks.

Some additional advantages of longer rail lengths:

Reduces the number of welding points at the railway track location. Welding of rails at the railway track location is more difficult to do than welding of rails in the plant.

Operations at our Raigarh plant is executed with the following special systems and equipment to guarantee maximum product integrity:

  • Specialized system for flash butt welding into rails of upto 480mtrs length.
  • Synchronized monorail hoist system for and handling and loading of long rails.
  • Specialized rakes for transfer of long rail panels to site.
  • No drilling in the rails is necessary for loading & unloading process.
  • High security against tilting of trains.
  • Deforming strain under admissible limits during handling & transportation.
  • The testing of welded joints is done at our Raigarh plant itself.

Fitch’s India Ratings and Research assigns ‘IND BBB’ to Jindal Stainless Limited with stable outlook

The successful turnaround for Jindal Stainless Limited (JSL) gets an impetus as, India Ratings and Research, a 100% owned subsidiary of Fitch Group assigns a long term issuer rating of ‘IND BBB’ with a stable outlook to the company. The rating push demonstrates improvement in creditworthiness of the company and is a reflection of higher operating performance, improved EBIDTA, and significant debt reduction achieved through implementation of an efficient Asset Monetisation Plan (AMP). Commenting on the rating, Managing Director of JSL, Mr Abhyuday Jindal said, “We are pleased with India Ratings recognition of our sustained efforts. JSL is globally known for its high-quality stainless steel, serving the developed economies of Europe and US apart from the domestic market. We cater critical applications in the nuclear industry, cryogenic applications, and white goods segment by providing all grades of stainless steel. JSL is pursuing its goal to fuel the government’s ‘Make in India’ initiative by making the country self-reliant for highgrade stainless steel products. This rating boost showcases the market sentiment and global acceptance of JSL’s products.” Earlier in June’18 CARE upgraded JSL’s credit rating from ‘CARE BB+ to CARE BBB-‘.

The highlights of the Ind-Ra release pointed to a strong operating performance by JSL, along with a successful turnaround and likely exit of the company from corporate debt restructuring (CDR).

The release also featured the diversified customer base of JSL as one of the key pillars favouring the Company. JSL serves a wide range of applications across industries in both domestic and international markets, including railways. In its release, Ind-Ra acknowledged JSL’s adequate liquidity position, improved credit metrics and fruitful implementation of AMP as key drivers that led to this rating improvement. “An improved operating performance and debt rationalisation over FY17-FY18 led to an improvement in the credit metrics of JSL. Its net leverage improved to 3.7 xs in FY18 from 30.0x in FY15, with interest coverage enhancing to 2.4x from 0.4x. Ind-Ra expects JSL’s credit metrics to improve further in view of healthy EBITDA/tonne over FY19-FY20, progressive debt repayments and low-to-moderate capex requirements in the medium term..”, the release read.

Shares of JINDAL STAINLESS LTD. was last trading in BSE at Rs.39.3 as compared to the previous close of Rs. 39.55. The total number of shares traded during the day was 118912 in over 836 trades.

The stock hit an intraday high of Rs. 40 and intraday low of 38.1. The net turnover during the day was Rs. 4687637.

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