According to a report by Credit Suisse, JSW Steel, has understated debt to the tune of Rs 11,900 crore for the year ended March 2012. While the company’s
net debt is around Rs 16,600 crore, the debt estimated by research firm Credit Suisse comes up to around Rs 28,500 crore.
There are three grounds on which it says the debt has been understated
•Acceptances went up from Rs 6,800 crore to Rs 7,500 crore for the year ended March 2012. This has been classified under account payable and not under debt.
•Un-hedged portion of dollar liabilities is now close to $3 billion. With the rupee down rom the end-March level, just the translation has eroded book value by Rs 54 per share or seven percent. Every one rupee fall hurts the book value by 1.8 percent.
Overall, Credit Suisse maintains an under perform rating on the stock with a price target of Rs 465 per share. The stock closed down one percent to Rs 715 per share.