#EBITDA #GROWTH

In FY25, the EBITDA stood at ₹1,868 cr, up by 16% YoY driven by growth in sales. In Q1 FY26, the EBITDA stood at ₹580 cr, up by 19% YoY and 13% QoQ. It grew on a YoY basis mainly on account of metallics and aluminum.

#PAT #GROWTH

In FY25, PAT declined by 12% YoY to ₹909 cr because of deferred tax adjustments in FY24, which created a high base effect. The PBT grew by 32% YoY. In Q1 FY26, PAT stood at ₹291 cr, up by 5% YoY and 32% QoQ. On a sequential basis, the growth was driven by lower depreciation and finance cost.

#EBITDA #MARGIN

In FY25, the EBITDA margin expanded by 18 bps YoY to 12.3% mainly on account of lower other expenses as a percentage of sales. In Q1 FY26, the EBITDA margin contracted by 38 bps YoY and expanded by 67 bps QoQ to 13.1%. It declined on a YoY basis mainly on account of specialty alloy.

#PAT #MARGIN

In FY25, PAT margin contracted to 6% (v/s 7.8% in FY24) due to tax adjustments in FY24. In Q1 FY26, PAT margin contracted by 106 bps YoY to 6.6%. However, it expanded by 126 bps on a QoQ basis.

#MANAGEMENT

The management over the years had invested in betterment of its infrastructure facilities and upgraded the technology as and when required, resulting in performance. better operating and financial They follow a model of waste to value while designing the production volumes and always believe in creating a fine balance in capacities, which had led to consistency of performance. The company had identified key levels like digitalization, operational digitization, operational excellence program based on the principle of Kaizen, 5S, Lean PPM (product portfolio management), TQM (total quality management). It engaged in, two operational excellence programs in its Bengal and Orissa plant with Boston Consulting Group and Renoir.

#COMPANY #POTENTIAL

• India’s finished steel consumption is anticipated to increase to 230 million tonnes (MT) by FY31. • There is an investment opportunity as this sector is witnessing consolidation of companies, which has led to investment by companies from other sectors. This further provides an opportunity for the global players to invest into Indian market. • Various Government’s initiatives drive growth in the sector such as National Steel Policy (NSP) 2017, which was implemented to encourage the industry to reach global benchmarks. In July 21, the Union Cabinet approved the Production Linked Incentive (PLI) scheme for speciality steel. The scheme is expected to attract investment worth ~₹400 billion. • Indian railways has proposed to spend ₹2   lakh crore a year till FY2023-24 to upgrade infrastructure, providing opportunities for increased demand of rail steel. • The opening of the mining sector and rapid investment in the infrastructure sector is expected to result in a growth in capital goods which consumes nearly 15 percent of the domestic steel produced. • The Indian Army, Navy and Air Force along with Defense Research and Development Organization (DRDO) and the Ordinance Factory have expressed great potential for domestic fulfilment of special steel alloy requirements in the defense sector. • Under housing for all by 2022 scheme, 10-12 million houses and 29.5 million units in rural areas are to be constructed with potential steel demand of 50-60 MT.

#COMPANY #OUTLOOK

• The company is increasing its combined production capacity from ~13.66 MTPA to 22.99 MTPA by FY27. This would include beneficiation plant of 3 MTPA, Billets (heavy structural mill) 0.4 MTPA, parallel flange beams 0.4 MTPA, colour coated Sheet 0.4 MTPA, sponge iron 1.2 MTPA, blast furnace 1.05 MTPA, coke oven 0.7 MTPA, DI Pipe 0.6 MTPA and others. • They are looking to increase the power generation in the captive power plant by 340 MW, resulting in a capacity growth from 357 MW to 697 MW. This will contribute ~85% to the total power requirements of the company, in the coming period. • The company’s low carbon ferro chrome project had been commissioned and ~70% of revenue from this project is through exports. The management plans to double its capacity in next 1 year. • They have now taken control over Ramsarup Industries Ltd. The acquisition was carried out via SS Natural Resources Pvt Ltd, a special purpose vehicle (SPV) in which the company holds 60% stake. The acquisition would help the company in improving its infrastructure facilities and build a new product mix. They would be incurring a total capex of ₹747 crore for its revival. • The contribution from the value-added product in revenue is expected to move up to 80% of the revenue in next 5 years from the present contribution of more than 50% to the revenue. • They announced the expansion of its production capabilities with the establishment of a greenfield Cold Rolling Mill (CRM) in Jamuria, West Bengal. It will have a total capacity of 0.4 MT annually. The project has a total capital cost of ₹603 cr, with ₹346 cr invested and ₹257 cr pending. The mill will specialize in producing pre-painted galvalume coils (PPGL) and coils of galvanized iron/galvanized steel (GI/GL). • The company will expand its stainless-steel production capacity from 1.5 lakh ton to 6 lakh ton in the next 5 years.
• They will also expand its carbon steel production capacity to 3.6 MT from 2.32 MT in next 2-3 years. • They have commissioned the color coated complex. In the color coated sheet, the EBITDA per ton is expected to be ₹5,500-₹6,500 in the coming period. The complete operations of the same will commence from December-January 2025 onwards. • The company will spend ₹1,160 cr over next 3 years to increase stainless steel capacity. • The DI pipe plant is going to be commissioned in FY26. • The company has signed the MOU (Memorandum of understanding) in aluminum foil business for EV batteries with the best of the battery manufacturers in the country and are expecting that they will be in full swing from FY25-FY26. • The company is aiming to achieve 15%-17% CAGR for sales, over the next 4-5 years. It will be driven by expansion in aluminum products & stainless steel, enhancing value of long products and focus on B2C (business to consumer) business.

Shyam Metalics and Energy Limited 800-915
Expected level 1150
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Siemens Company Details

Siemens is a technology company focused on industry, infrastructure, mobility, and healthcare. Siemens (India) Limited was incorporated in the year 1922 as a private limited company and currently, is the flagship listed company of Siemens AG in India. The company operates in 4 segments: Energy, Smart infrastructure, Digital industries & Mobility and follows a financial year of October-September. Energy segment provides fully integrated products, solutions and services across the energy value chain of oil and gas production, power generation and transmission for various customers. Smart infrastructure portfolio covers systems for low & medium voltage distribution, solutions for smart grids & energy automation and low voltage power supply systems. Digital industries contains portfolio of leading-edge automation, drives and software technologies covering the complete life cycle from product design and production execution to services for discrete and process Industries. Mobility segment is a supplier of solutions for passenger and freight transportation including rail vehicles, rail automation systems, rail electrification systems, road traffic technology and IT solutions. The company is positioned along the electrification value chain – from power generation, transmission and distribution to smart grid solutions and efficient application of electrical energy. During the year, the company’s major highlight was securing an order valued at ₹26,000 crore to supply 1,200 locomotives for the Indian railways. This has been the largest order in the history company. Also, it had acquired the EV division of Mumbai-based MassTech Controls Private Limited, primarily engaged in design, engineering and manufacturing of a wide range of alternate current chargers.

Segmentwise revenue

Region wise revenue

#SALES #GROWTH 5 Year CAGR 11.9%

In FY24, sales rose 14% YoY to ₹22,240 cr, led by strong growth across mobility, smart infrastructure and digital industries. New orders stood at ₹23,564 cr (v/s ₹46,383 cr in FY23). Excluding the large 9,000 HP electric locomotive order received in FY23, new orders rose by ~14% in FY24. In Q1 FY25, the Energy business was classified as discontinued operations. In 9M FY25, sales (excluding the discontinued operations of Energy business) grew by ~5% YoY to ₹12,193 cr. Segment-wise, revenue for smart infrastructure, mobility and low voltage motors grew, driven by order execution; however, digital industries sales declined due to lower execution. New orders rose ~24% YoY to ₹15,240 cr (v/s ₹12,287 cr in 9M FY24). Order backlog stood at ~₹42,845 cr in Q3 FY25. .

#EBITDA #GROWTH 5 Year CAGR 15.4%

In FY24, EBITDA grew by 25% YoY to ₹3,104 cr, led by improvement in gross profit. This was further supported by project execution in the mobility and energy businesses. Major expenses for the company constituted cost of materials ~23%, purchase of traded goods ~24% and project bought outs ~21%. In 9M FY25, the EBITDA de-grew by ~12% YoY to ₹1,390 cr, led by increase in operating expenses and employee benefit expenses. Other expenses included a one-time demerger expense of ₹63 cr. Excluding the same, EBITDA declined by ~8% YoY to ₹1,453 cr. Segment-wise, the company witnessed lower volumes and higher material costs in the Digital Industries segment during the quarter.

#PAT #GROWTH 5 Year CAGR 19.8%

n FY24, PAT grew by 39% YoY to ₹2,718 cr, backed by improved operating profit, higher other income and lower effective tax rate. Other income grew by ~86% YoY on account of sale of property of ₹230 cr during FY24 (v/s ₹24 cr in FY23) and dividend received from subsidiaries of ₹146 cr (v/s ₹78 cr in FY23). In 9M FY25, PAT declined by ~20% YoY to ₹1,203 cr, led by lower operating profit. It included an extraordinary gain of ~₹6 cr on account of the sale of properties in Q3 FY25 (v/s ~₹221 cr in 9M FY24) and demerger expenses of ₹63 cr in Q2 FY25. Excluding these, PAT declined by ~1% to ₹1,261 cr (v/s ₹1,277 cr in 9M FY24)..

#EBITDA #MARGIN

In FY24, EBITDA margin expanded by 124 bps YoY to 14%, led by gross margin expansion of 261 bps YoY. Further aided by rising volumes, favorable portfolio mix and better pricing. In 9M FY25, EBITDA margins contracted by ~215 bps YoY to 11.4%, primarily due to increase in other expenses and employee benefit expenses as a percentage of revenue. Other expenses included a one-time demerger expense, excluding which, the EBITDA margin contracted by ~164 bps YoY to 11.9%. Segment-wise, operating margins during 9M FY25 contracted on account of lower margins in the digital industries, low voltage motors (portfolio companies has been renamed to low voltage motors) and mobility segment to ~7.1%, ~4.3% and ~5.9%, respectively (v/s ~12.9%, ~9.4% and ~6.6%, respectively in 9M FY24). While smart infrastructure expanded on a YoY basis to ~13.6% (v/s ~13.1% in 9M FY24).

#ROCE

In FY24, the metric rose to 26.29% (v/s 21.88% in FY23), backed by growth in the operating profit. The company has been able to improve its ROCE, and this was on the back of growth in earnings for the year. The improvement in earnings was largely driven by smart infrastructure and digital industries segments. Large orders were bagged in Energy, and mobility sectors, followed by smart infrastructure and digital industries. Private capex across verticals and continued focus on increasing digitalization business helped in improving the ROCE for the company.

#ROE

In FY24, ROE for the company improved to 19.11%, backed by rising net profit. The order growth was robust across all its businesses, backed by healthy demand. While demand in digital industries continued to stabilize as it normalized. Excluding the locomotives order, the book-to-bill ratio stood at 1.13x during the year. The company is focusing on driving profitable growth, with digitalization being a key focus area which would further help in improving the profitability and maintaining healthy return ratios of the company, going ahead.