NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
IDBI Capital Report
Steel Authority of India Ltd.’s Q1 FY25 performance was below our forecast. Revenue fell by 14.2% QoQ to Rs 253 billion due to a volume decline of 12.1% QoQ, driven by an influx of cheap Chinese imports, a heat wave and general elections. Despite this, SAIL slightly increased its sales volume guidance from 19 million tonne to 19.26 mt for FY25.
Ebitda decreased by 36.1% QoQ to Rs 22 billion, and Ebitda/tonne decreased by 27.4% QoQ to Rs 5,535. SAIL’s net debt increased by Rs 56 billion QoQ to Rs 356.6 billion, due to inventory buildup of coking coal and semi-finished products.
We cut our FY25/FY26 Ebitda forecast by 10% each, factoring lower steel prices. We now value the stock at enterprise value/Ebitda multiple of 6.5 times FY26E Ebitda and arrive at target price of Rs 129, given healthy demand outlook for domestic steel sector and robust volume guidance for FY25. We maintain our Hold rating on the stock.
Click on the attachment to read the full report:
SAIL Q1 Results: Profit Down 62%, Misses Estimates
DISCLAIMER
This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
. Read more on Research Reports by NDTV Profit.