Jai Balaji Industries Ltd: Breaks Out

Jai Balaji Industries Ltd today moved  up and  hit the buyer Freeze in BSE, buoyed on the mining story, as it closed above its 100 DSMA and 200 DSMA.  The scrip clocked a good volume today in the BSE (16, 873) against its 2 W Average. What is interesting is the delivery volume which is 84.20% and looks convincing. The promoters have been continuously buying the share from the market, through open market purchases. Another important development is that, it is out of T-group and should be available for netting. 
On the fundamental front there two few prominent developments: 

• The Company's planned expansion of 350000 MTPA Coke Oven Plant along with Waste Heat Recovery Boiler of 80 TPH is in advanced stage and infrastructure work of roads & drains for the entire plant is commissioned.
• The DRI Plant of 60000 MT & coal washery in subsidiary company M/s  Nilachal Iron & Power Limited is already commissioned and Forest Clearance certificate, pollution clearance and clearance from the Ministry of Environment has been received. The Dumri Coal Block has also received Environmental Clearance and Fresh Go Certificate.
• The Company received Carbon Credit, Volume of CERs: 55730 (Tradable Volume: 54615) on account of Power generated from its Waste Heat Recovery Boilers by the UNFCCC and first monetary receipt of approximately Rs. 33 million (Rupees thirty three millions only) on account of sale of 54615 units of Carbon Credit. This is expected in the coming months.
• The Company has received a Certificate of Conformity for production of Ductile Iron Pipes for water pipelines, which is in Conformity against the requirements of the following standards: ISO 2531:2009, EN 545:2010 by BUREAU VERITAS Certification. 
• Jai Balaji Industries Ltd has applied for restructuring of its debts and has received the Corporate Debt Restructuring letter of approval dated 20th September, 2012 from CDR Empowered Group/CDR Cell pursuant to the CDR package approved by the CDR empowered group. The company has got some interest subvention in this respect. 

Joint Ventures: (a)  A Joint Venture Company M/s. Andal East Coal Company Private Limited was formed in 2009-10 with the Registrar of Companies, West Bengal, in which the Company along with M/ s. Bhushan Steel Limited and M/S. Rashmi Cement Limited are venture partners. The said Joint Venture Company was formed in terms of allocation of Andal Non-Coking Coal Block in the State of West Bengal by Ministry of Coal, Government of India.  The Company has 32.79% stake in the coal block.

(b) A Joint Venture Company M/s. Rohne Coal Company Private Limited was formed in 2008-09 with the Registrar of Companies, NCT of Delhi &  Haryana, in which the Company along with M/ s. JSW Steel Limited & M/S. Bhushan Power & Steel Limited are venture partners. The said Joint Venture Company was formed in terms of allocation of Rohne- Coking Coal Block in the State of Jharkhand by Ministry of Coal, Government of India.  The Company has 6.90% stake in the coal block. Both the Joint Venture Companies are in the process of setting up coal mining facilities at respective coal blocks. 

Moreover, the company has an installed capacity of 101 Mw of power and in the last 15 months it has produced 505 .91 MU as against   400. 73 M U in F Y11.  Also,  the actual production of Sponger Iron, Pig Iron, Steel Bars/Rods, Billets/ MS Ingots, Ferro Alloyws, Duc tile Iron Pipes and Sinter are expected to improve in the coming months due to optimism coming from China and other major steel consuming areas.
The company reasonably believes that the turbulent conditions during FY12 and H1FY13, did not allow the potential of the operations to be fully realized, but such unfavorable conditions will not be a lasting phenomenon. In order to secure its long-term competitive position, the Company will continue to focus on its growth strategies. I am expecting some more buyer freezes in the coming days.