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SMLT - Sarthak Metals

📊 NSE: SMLT 🏢 Steel - Medium / Small 📅 Last Updated: 12/14/2025 12:53

📢 Recent Corporate Announcements

Sarthak Metals Q3 FY26: Revenue Grows 8% YoY to ₹47.73 Cr; Welding Volumes Surge 182%

🟡 NEUTRAL ⭐ 7/10

EARNINGS 📅 11 Feb 2026, 01:18 PM

Sarthak Metals Limited (SMLT) reported a steady Q3 FY26 performance with revenue from operations increasing 8% YoY to ₹47.73 crore and PAT rising 6% YoY to ₹1.30 crore. The core Cored Wire segment maintained stability with a 1% volume growth, while the new Welding division showed exceptional momentum with volumes surging 182% YoY to 409 tonnes. However, the Aluminium Flipping Coil segment faced significant headwinds, with volumes declining 37% YoY due to unethical competition and pricing distortions. The company is actively diversifying, with its Biotechnology pilot facility in Nagpur now operational and targeting the ethanol sector.

Revenue from operations grew 8% YoY to ₹47.73 Cr and 31% QoQ, indicating a strong sequential recovery.
Welding business achieved ₹4.4 Cr revenue in Q3 with volumes of 409 tonnes, aiming for ₹25 Cr annual sales within two years.
EBITDA margins saw a slight contraction of 27 bps YoY to 4.41% due to international price disparities and raw material challenges.
Aluminium Flipping Coil segment revenue stood at ₹6 Cr, but operations are currently subdued due to unviable market pricing.
Biotechnology initiative is progressing with a 14 kg pilot facility operational in Nagpur and discussions ongoing with ethanol distilleries.

💡 Investors should focus on the rapid scaling of the Welding division and the progress of the Biotechnology pilot as potential margin drivers. While the core steel-related segments face competitive and pricing pressures, the company's diversification strategy into import-substitution products like flux-cored wires warrants a watch.

Sarthak Metals Q3 FY26 Net Profit Rises 6.3% YoY to ₹1.30 Crore; Revenue Up 8.5%

🟢 POSITIVE ⭐ 7/10

EARNINGS 📅 10 Feb 2026, 12:50 PM

Sarthak Metals Limited (SMLT) reported a steady performance for the quarter ended December 31, 2025, with revenue from operations growing 8.5% YoY to ₹47.73 crore. Net profit for the quarter saw a modest increase to ₹1.30 crore, up from ₹1.22 crore in the corresponding quarter of the previous year. The company continues to maintain a strong financial position with zero debt across all categories. For the nine-month period ended December 2025, the company achieved a total income of ₹131.55 crore and a net profit of ₹3.12 crore.

Revenue from operations increased to ₹4,772.94 lakhs in Q3 FY26 compared to ₹4,399.70 lakhs in Q3 FY25.
Net profit for the quarter stood at ₹129.72 lakhs, reflecting a 6.3% growth over the previous year's ₹122.02 lakhs.
The company remains completely debt-free with zero outstanding loans or debt securities as of December 31, 2025.
Earnings Per Share (EPS) for the quarter improved to ₹0.95 from ₹0.92 YoY.
Inventory levels rose significantly to ₹3,765.76 lakhs from ₹2,742.11 lakhs in March 2025, suggesting preparation for higher demand.

💡 The company's debt-free status and consistent profitability in a niche segment like cored wires make it a stable small-cap play. Investors should monitor if the high inventory levels translate into stronger sales growth in the final quarter of the fiscal year.

Sarthak Metals to Close Trading Window from Jan 1, 2026 for Q3 Results

🟡 NEUTRAL ⭐ 2/10

ROUTINE 📅 24 Dec 2025, 10:21 AM

Sarthak Metals Limited (SMLT) has announced the closure of its trading window starting January 1, 2026, in compliance with SEBI Insider Trading regulations. This closure is a standard procedure ahead of the declaration of financial results for the quarter ending December 31, 2025. The restriction applies to all directors, officers, and designated persons of the company. The window will remain closed until 48 hours after the board meeting where the quarterly results are officially declared.

Trading window closure begins on January 1, 2026, for all designated persons.
The closure is related to the upcoming financial results for the quarter ending December 31, 2025.
Trading restriction will be lifted 48 hours after the results are made public.
The date for the board meeting to consider results will be announced separately.
Compliance with SEBI (Prohibition of Insider Trading) Regulations, 2015.

💡 This is a routine regulatory announcement with no impact on company fundamentals. Investors should monitor for the upcoming board meeting date to review the Q3 financial performance.

Sarthak Metals Expands Business Scope into Biotech and Specialty Chemicals via MOA Amendment

🟢 POSITIVE ⭐ 7/10

EXPANSION 📅 15 Dec 2025, 11:10 AM

Sarthak Metals Limited (SMLT) has received shareholder approval to significantly diversify its business operations by adding biotechnology and specialty chemicals to its Memorandum of Association. This strategic shift allows the company to enter high-growth sectors including bio-fertilizers, pharmaceuticals, and nutraceuticals. Additionally, the company has secured the re-appointment of Mr. Sunil Dutt Bhatt as an Independent Director for a second five-year term effective from August 2026. These developments signal a long-term intent to move beyond traditional metal-related activities into diversified industrial segments.

Shareholders approved the addition of Clause 9 to the MOA to include biotechnology, enzymes, and bio-based chemicals.
The new business scope covers R&D, manufacturing, and trading of pharmaceuticals, bio-inputs, and nutraceuticals.
Mr. Sunil Dutt Bhatt re-appointed as Independent Director for a 5-year term from August 3, 2026, to August 2, 2031.
The expansion includes provisions for technology transfer, consultancy, and contract research services.
Resolutions were passed via Postal Ballot which concluded on December 12, 2025.

💡 Investors should monitor management's follow-up plans regarding capital allocation and project timelines for the new biotechnology vertical. While diversification reduces cyclical metal risk, the company's execution capability in these specialized sectors will be a key performance driver.

Sarthak Metals Shareholders Approve Postal Ballot Resolutions with Requisite Majority

🟡 NEUTRAL ⭐ 3/10

ROUTINE 📅 15 Dec 2025, 10:38 AM

Sarthak Metals Limited has announced the successful passage of resolutions proposed in its Postal Ballot notice dated November 12, 2025. The e-voting process concluded on December 12, 2025, with the Scrutinizer, CA Atul Jain, confirming approval by the requisite majority. This filing is a mandatory regulatory disclosure under SEBI Listing Obligations and Disclosure Requirements. The approval allows the company to move forward with the specific corporate actions outlined in the original notice.

Postal Ballot e-voting period concluded successfully on December 12, 2025
All resolutions passed with the requisite majority as per Scrutinizer report dated December 14, 2025
Compliance maintained under Regulations 30 and 44 of SEBI LODR Regulations
Scrutinizer for the process was CA Atul Jain of M/s. Atul Jain & Co.

💡 No immediate action is required as this is a routine regulatory filing. Investors should review the original Postal Ballot notice dated November 12 to understand the specific business items approved.

View All SMLT Announcements on Live Market Tracking →

💰 Financial Performance

Revenue Growth by Segment

Revenue from operations for Q2 FY26 was INR 36.31 Cr, representing a 21% YoY decline from INR 45.72 Cr in Q2 FY25. The Aluminium Flipping Coil segment saw a 47.37% YoY volume drop to 180 tonnes, though realizations improved 17.03% to INR 2.68 Lakh/Tonne. Historical revenue grew 106% from INR 221.93 Cr in FY21 to INR 457.31 Cr in FY22.

Geographic Revenue Split

Not disclosed in available documents, though the company utilizes exports to provide a natural hedge against currency fluctuations.

Profitability Margins

PAT margins were 6.01% in FY22 and improved to 7.29% in FY23. For Q2 FY26, PAT was INR 0.76 Cr, down 8% YoY from INR 0.83 Cr. Operating margins in H1 FY23 improved to 10.35% from 9.01% in FY22 due to higher capacity utilization.

EBITDA Margin

EBITDA margin for Q2 FY26 was 4.53%, an improvement of 32 bps YoY from 4.21% in Q2 FY25. This margin expansion occurred despite a 15% YoY drop in absolute EBITDA to INR 1.64 Cr, driven by strategic withdrawal from low-margin segments.

Capital Expenditure

Not disclosed in absolute INR Cr, but the company is expected to increase production capacity over the medium term. Debt-funded capex is monitored as a potential risk to liquidity.

Credit Rating & Borrowing

CRISIL BBB/Positive (Outlook revised from Stable in Nov 2022). Total bank loan facilities rated at INR 27.25 Cr. Repayment obligations were INR 1.68 Cr for FY23 and INR 2.58 Cr for FY24.

⚙️ Operational Drivers

Raw Materials

Aluminum and Ferro alloys are the primary raw materials, with costs susceptible to high volatility which impacts operating margins.

Import Sources

Not disclosed in available documents, but benchmarking to international commodity exchanges and US Dollar benchmarking suggests global sourcing.

Key Suppliers

Key suppliers include Tata Steel Ltd, Jindal Steel and Power Ltd, and Jindal Stainless Limited, who also serve as major customers.

Capacity Expansion

Current capacity utilization has reached healthy levels, leading to an ROCE of over 25.5% in FY22. Planned expansion is expected over the medium term to support revenue growth.

Raw Material Costs

Raw material costs are managed through long-term contracts benchmarked to international commodity exchanges to provide supply-side hedges. Operating margins of 9.01% in FY22 indicate sufficient cost pass-through.

Manufacturing Efficiency

Operating income to gross block ratio was over 21 times as of March 31, 2022, indicating high asset turnover and efficiency.

📈 Strategic Growth

Growth Strategy

Growth will be driven by the new Welding division (targeting INR 25 Cr+ sales with 9-10% EBITDA margins) and the upcoming Biotech segment targeting distillery companies. The company is also expanding its SKU count from 5 to 10 in the welding business.

Products & Services

Metallurgical cored wires, aluminum flipping coil, and welding consumables (welding division).

Brand Portfolio

Sarthak Metals Limited (SMLT).

New Products/Services

Welding division (star performer) and Biotech division (revenue expected to start very soon with positive response from distilleries).

Market Expansion

The company is targeting the distillery sector for its biotech products and expanding its presence in the welding consumables market.

🌍 External Factors

Industry Trends

The industry is seeing intense price pressure and 'unethical competition' in certain segments like flipping coils, leading players to focus on technological differentiation and niche segments like welding.

Competitive Landscape

Faces competition from domestic and established players; currently navigating a subdued market due to unethical competitive practices in the flipping coil segment.

Competitive Moat

Moat is built on 5 decades of promoter experience and deep-rooted relationships with Tier-1 steel manufacturers, which mitigates bad debt risk and ensures raw material supply.

Macro Economic Sensitivity

Highly sensitive to the steel industry, which is driven by infrastructure and real estate cyclicality. Volumetric growth of 35% in FY22 was directly linked to robust steel demand.

⚖️ Regulatory & Governance

Industry Regulations

Complies with SEBI Listing Obligations and Disclosure Requirements (LODR) 2015, specifically Regulations 17 to 27 regarding corporate governance.

Legal Contingencies

No material financial or commercial transactions by senior management with personal interest were reported. Statutory audit fees were INR 5,00,000.

⚠️ Risk Analysis

Key Uncertainties

Volatility in aluminum and ferro alloy prices can squeeze operating margins if cost pass-through is delayed. Dependency on the cyclical infrastructure sector poses a risk to volume stability.