⚠ Disclaimer: This report is generated using AI tools and is for informational purposes only. It does not constitute investment advice. Please consult a registered financial advisor before making any investment decisions.
SAIL - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.6
| Stock Code | SAIL | Market Cap | 63,912 Cr. | Current Price | 155 ₹ | High / Low | 168 ₹ |
| Stock P/E | 21.5 | Book Value | 136 ₹ | Dividend Yield | 1.04 % | ROCE | 6.73 % |
| ROE | 4.38 % | Face Value | 10.0 ₹ | DMA 50 | 153 ₹ | DMA 200 | 140 ₹ |
| Chg in FII Hold | 0.78 % | Chg in DII Hold | -0.26 % | PAT Qtr | 442 Cr. | PAT Prev Qtr | 645 Cr. |
| RSI | 49.7 | MACD | -1.17 | Volume | 2,38,18,142 | Avg Vol 1Wk | 2,19,62,691 |
| Low price | 101 ₹ | High price | 168 ₹ | PEG Ratio | -0.51 | Debt to equity | 0.60 |
| 52w Index | 79.7 % | Qtr Profit Var | 286 % | EPS | 6.61 ₹ | Industry PE | 20.1 |
📊 Financial Overview
- Revenue & Profit Growth: Quarterly PAT declined from ₹645 Cr. to ₹442 Cr., showing pressure on earnings.
- Margins: ROE at 4.38% is weak, while ROCE at 6.73% reflects modest efficiency.
- Debt: Debt-to-equity ratio of 0.60 is manageable compared to peers, indicating moderate leverage.
- Cash Flow: Supported by steel demand cycles but vulnerable to commodity price fluctuations.
💹 Valuation Indicators
- P/E Ratio: 21.5 vs Industry PE of 20.1 → slightly expensive relative to peers.
- P/B Ratio: Current Price ₹155 vs Book Value ₹136 → ~1.14x, fairly valued.
- PEG Ratio: -0.51 → negative, reflecting weak earnings growth outlook.
- Intrinsic Value: Estimated fair value near ₹145–150, suggesting current price is slightly overvalued.
🏭 Business Model & Competitive Advantage
- Leading public sector steel producer with integrated operations.
- Government backing provides stability but limits agility compared to private peers.
- Competitive advantage lies in scale and domestic market presence, though global competitiveness is limited.
📈 Entry Zone & Long-Term Guidance
- Entry Zone: Attractive between ₹135–145, closer to intrinsic value.
- Long-Term Holding: Suitable only for cyclical investors; hold with caution due to weak ROE and earnings volatility.
✅ Positive
- Debt-to-equity ratio at 0.60 is moderate, reducing financial risk.
- Improved FII holdings (+0.78%) show foreign investor interest.
- Strong domestic demand for steel supports long-term prospects.
⚠️ Limitation
- Weak ROE at 4.38% indicates poor shareholder returns.
- Quarterly PAT decline highlights earnings pressure.
- PEG ratio negative, signaling weak growth outlook.
📉 Company Negative News
- Falling quarterly profits due to margin pressure.
- Global steel price volatility impacting profitability.
📈 Company Positive News
- Government infrastructure push supports steel demand.
- Improved FII participation reflects confidence in long-term growth.
- Operational efficiency improving with modernization initiatives.
🏭 Industry
- Steel industry is cyclical, heavily dependent on global commodity prices and demand.
- Industry PE at 20.1 shows sector is moderately valued.
- Government-led infrastructure projects provide demand stability in India.
🔎 Conclusion
SAIL shows moderate fundamentals with weak ROE and declining profits, though debt levels remain manageable. Valuation is slightly expensive compared to intrinsic value, making entry around ₹135–145 more attractive. Long-term holding is viable only for investors comfortable with cyclical risks, as industry demand and government support provide stability but earnings remain volatile.