SHYAMMETL - Fundamental Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Fundamental Rating: 3.7

📊 Core Financial Analysis

Profitability & Returns

EPS: ₹33.1 — solid earnings for a ₹992 stock.

ROE: 8.99% & ROCE: 12.0% — decent, but not exceptional for a capital-intensive business.

PAT Qtr: ₹291 Cr vs ₹219 Cr — healthy sequential growth, but YoY growth of just 5.27% suggests slowing momentum.

Debt & Leverage

Debt-to-Equity: 0.07 — extremely low leverage, a major strength in the metals sector.

Dividend Yield: 0.45% — modest, but consistent with reinvestment strategy.

Book Value: ₹378 — trading at ~2.6x book, which is high for a cyclical metal stock.

💰 Valuation Metrics

Metric Value Insight

P/E Ratio 30.1 Overvalued vs industry PE of 23.8

P/B Ratio ~2.62 High for a commodity business

PEG Ratio -1.56 Negative PEG reflects earnings stagnation, not growth

Intrinsic Value ~₹800–₹850 Current price is above fair value, suggesting limited upside

🏢 Business Model & Competitive Edge

Shyam Metalics operates in

Ferro alloys

Steel billets, TMT bars, and sponge iron

Competitive advantages include

Integrated operations

Low debt and strong cash flows

Expansion into aluminum foil and captive power

However, it's exposed to commodity price cycles, global demand shifts, and input cost volatility.

📉 Technical & Sentiment Indicators

RSI: 75.0 — overbought, caution warranted.

MACD: 28.1 — strong bullish momentum.

Volume below average — rally may be losing steam.

DMA 50 & 200 well below current price — extended uptrend.

FII selling, DII buying — mixed institutional sentiment.

🧠 Investment Guidance

🔍 Entry Zone (If Undervalued)

Wait for pullback to ₹850–₹880

Current price is overheated and above intrinsic value.

RSI suggests near-term correction likely.

📈 Long-Term Holding View

Hold with caution

Strong fundamentals and low debt.

Overvaluation and cyclical risks limit upside.

Ideal for accumulation on dips, not at current levels.

Would you like a peer comparison with Tata Steel, JSW Steel, or Jindal Stainless to see how Shyam Metalics stacks up in terms of margins and growth?

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