SAIL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.8
| Stock Code | SAIL | Market Cap | 76,258 Cr. | Current Price | 185 ₹ | High / Low | 189 ₹ |
| Stock P/E | 25.7 | Book Value | 136 ₹ | Dividend Yield | 0.87 % | ROCE | 6.73 % |
| ROE | 4.38 % | Face Value | 10.0 ₹ | DMA 50 | 164 ₹ | DMA 200 | 146 ₹ |
| Chg in FII Hold | 0.47 % | Chg in DII Hold | 0.56 % | PAT Qtr | 442 Cr. | PAT Prev Qtr | 645 Cr. |
| RSI | 73.1 | MACD | 7.57 | Volume | 3,12,90,012 | Avg Vol 1Wk | 3,35,05,307 |
| Low price | 106 ₹ | High price | 189 ₹ | PEG Ratio | -0.61 | Debt to equity | 0.60 |
| 52w Index | 94.6 % | Qtr Profit Var | 286 % | EPS | 6.61 ₹ | Industry PE | 22.9 |
📊 SAIL (Steel Authority of India Ltd.) shows mixed fundamentals. While the company has demonstrated strong quarterly profit variation (286%) and trades above both 50 DMA (₹164) and 200 DMA (₹146), its weak ROE (4.38%) and ROCE (6.73%) limit long-term attractiveness. The current P/E of 25.7 is higher than the industry average (22.9), suggesting overvaluation. The PEG ratio of -0.61 further reflects poor growth relative to valuation. Debt-to-equity remains manageable at 0.60, but profitability metrics are underwhelming.
💰 Ideal Entry Price Zone: Around ₹170–175, closer to support levels, to improve risk-reward balance.
📈 Exit Strategy / Holding Period: Suitable for short-term swing trades with exits near ₹188–190 resistance. Long-term holding is not recommended unless ROCE improves above 10% and earnings sustain.
✅ Positive
- Quarterly profit variation shows strong rebound (286%).
- EPS of ₹6.61 indicates earnings recovery.
- FII holdings increased by 0.47% and DII holdings by 0.56%, showing institutional confidence.
- Debt-to-equity ratio is low (0.60), reducing financial risk.
- Stock trading above 50 DMA and 200 DMA reflects momentum.
⚠️ Limitation
- High P/E ratio (25.7) compared to industry P/E (22.9), suggesting overvaluation.
- ROE is weak at 4.38%, limiting shareholder returns.
- ROCE at 6.73% is below healthy benchmarks.
- PEG ratio is negative (-0.61), reflecting poor growth relative to valuation.
- Dividend yield is low (0.87%), offering limited income to investors.
📉 Company Negative News
- PAT declined from ₹645 Cr. to ₹442 Cr. in the latest quarter.
- High RSI (73.1) indicates overbought conditions, limiting upside.
📈 Company Positive News
- Strong quarterly profit variation (286%) highlights recovery momentum.
- Stock trading near 52-week high shows strong investor sentiment.
- Volumes remain robust, supporting liquidity for traders.
🏭 Industry
- Industry P/E is slightly lower (22.9), meaning SAIL trades at a premium.
- Steel sector demand remains cyclical but supported by infrastructure growth.
🔎 Conclusion
SAIL is a fair candidate for swing trading, but caution is advised due to overbought RSI and proximity to its 52-week high. Enter near ₹170–175 for better risk-reward and exit around ₹188–190 to capture short-term gains. Long-term investors should wait for improved ROCE and sustained earnings before considering accumulation.