Shyam Metalics reported a 23% year-over-year increase in revenue and a 26% rise in EBITDA for Q2 FY26. Despite a challenging macro environment, the company saw revenue of INR4,457 crores and an EBITDA of INR609 crores. The company discontinued its DI pipe plant project and is focusing on high-value segments and expanding value-added offerings. They anticipate revenue from the blast furnace to start in December 2025.
Financial Performance
Shyam Metalics showcased strong financial results in Q2 FY26, marked by significant revenue and EBITDA growth:
- Revenue: Increased by 23% year-over-year.
- EBITDA: Grew by 26% year-over-year.
- Volume Growth: Up by 24% year-over-year.
- Revenue: INR4,457 crores for the quarter.
- EBITDA: INR609 crores for the quarter.
- PAT: INR260 crores.
- H1 FY26 Revenue: INR8,876 crores, up 22.5% year-over-year.
- H1 FY26 EBITDA: INR1,242 crores, up 21.8% year-over-year.
- H1 FY26 PAT: INR551 crores, up 12.1% year-over-year.
Strategic Decisions
The company has made key strategic decisions to optimize its portfolio and improve long-term results:
- Discontinued the DI pipe plant project to redirect capital to higher-value segments.
- Blast furnace commissioning is in its final stage, expected to commercialize production soon.
- Capacity enhancement to serve the growing demand for alloy, carbon, and special steel products. Expected revenue contribution from December 2025.
Credit Rating Upgrade
CRISIL Ratings upgraded Shyam Metalics’ long-term rating, reflecting the company’s strong business risk profile and healthy financials:
- Long-term rating upgraded to CRISIL AA+ Stable.
- Short-term rating reaffirmed at CRISIL A1+.
Capex and Future Growth
The company’s growth roadmap remains on track with ongoing capex progressing well:
- INR7,529 crores of capex incurred as of H1 FY26, representing 80% of the total capex plan.
- INR4,908 crores already capitalized.
- Capex program scheduled to be fully developed by March 2027.
Operational Efficiency and Product Mix
Shyam Metalics is focused on improving its product mix and enhancing operational efficiency:
- Working capital cycle improved to 18 days.
- Gross debt-to-equity ratio at 0.10x.
- Cash positive with investments and bank balance of INR1,694 crores against a gross debt of INR1,075 crores.
Aluminium and Stainless Steel Expansion
The company is expanding into aluminium and stainless steel with backward integration to create a value-added chain:
- Expects to benefit from the PLI scheme for stainless steel.
- Setting up a flat product plant to produce stainless steel from iron ore and ferro alloy ores using captive power.
- Aluminium mill with caster and aluminium flat rolled product commissioning expected in the second quarter of the next financial year.
Source: BSE
