SAIL - Investment Analysis

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

Investment Rating: 3.6

🧱 Fundamental Analysis

Positives

Book Value (₹143) > Current Price (₹126): Trading below book value, indicating undervaluation.

Dividend Yield (1.59%): Decent for a cyclical stock.

Debt-to-Equity (0.63): Moderate leverage, manageable for a capital-intensive industry.

FII & DII Holding Increase: Institutional confidence is improving.

PEG Ratio (-0.42): Suggests undervaluation, though negative PEG may reflect earnings volatility.

Negatives

ROE (4.48%) & ROCE (6.72%): Weak return metrics, not ideal for long-term compounding.

P/E (17.1) vs Industry P/E (22.4): Fairly valued, but not cheap given low profitability.

Quarterly PAT Drop: From ₹1,273 Cr to ₹745 Cr, a steep decline.

EPS (₹7.35): Low earnings per share for a large-cap PSU.

📉 Technical & Trend Analysis

RSI (36.8): Near oversold zone, potential for short-term bounce.

MACD (-0.24): Bearish momentum persists.

Price below 50 DMA (₹130) and near 200 DMA (₹123)**: Weak trend, but approaching support.

Volume: Slightly below average, indicating reduced interest.

💰 Ideal Entry Price Zone

Accumulation Zone: ₹115–₹122

This range aligns with 200 DMA and historical support.

Wait for RSI to dip below 35 or MACD to turn positive for confirmation.

🧭 Exit Strategy / Holding Period

If you already hold SAIL

Hold for 2–3 years if you expect a cyclical rebound in steel demand.

Exit partially if price approaches ₹150–₹160 and fundamentals don’t improve.

Reassess if ROE stays below 6% or global steel prices weaken.

Long-Term Outlook

2030 Target Range: ₹390–₹420

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10-Year Projection: ₹459.06

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Growth Drivers: Infrastructure push, export demand, operational efficiency.

🧠 Summary

SAIL is a cyclical value play, not a compounding machine. It suits investors who can time commodity cycles and are comfortable with volatility. For long-term investors, it’s best treated as a tactical allocation rather than a core holding.

Would you like a comparison with Tata Steel or JSW Steel to evaluate sector positioning?

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bing.com

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sharesprediction.com

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