Kalyani Steels Limited

Basic Materials — Steel · NSE

₹951.25+₹4.30 (+0.45%)

DalalBaazaar Score

68 / 100

🟢 Good

Verdict

REASONABLE

Risk

Low

Driven by micro-cap size, which brings thin liquidity.

In simple words: Strong business and financial position, with modest growth. Nothing on this snapshot stands out as an immediate concern — the usual checks on business quality and management still apply.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:59 pm

Understanding the Business

Company site ↗

The 60-second version of Kalyani Steels Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

Kalyani Steels Limited manufactures and sells iron and steel products in India and internationally.

IndustrySteel

SectorBasic Materials

Employees138

Annual revenue₹1,813 Cr

How does it make money?

Turns over ₹1,813 Cr a year. Of every ₹100 of sales, about ₹14 reaches shareholders as profit, with ₹23 left at the operating level before interest, tax and depreciation. Each of its 138 employees supports ₹13.14 Cr of revenue a year, the signature of a capital- or asset-led business.

Revenue / employee₹13.14 Cr

Who are its competitors?

The closest listed comparisons in its industry are TATA STEEL LIMITED, JSW STEEL LIMITED, JINDAL STEEL LIMITED, STEEL AUTHORITY OF INDIA. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?Some evidence

ROCE of 16.2% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

Peer median ROE10.8%

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -3% while net margin moved +60% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect-3%

Margin effect+60%

DalalBaazaar Score

68/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Revenue has contracted at 1.1% a year
✓ Profit CAGR of 15.6% is above 15%

Quality vs. Valuation

Company Quality

71/ 100

Good

How good the business is, ignoring the share price entirely.

Valuation

61/ 100

Fair

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

15.7x

3Y Median

14.7x

40 monthly readings · mean 15.5x · range 9.8x–24.3x

Sector Median

18.2x

median of 4 sector peers

🟡Currently trading close to its 3y median of 14.7x — the market is paying about what it usually pays for this company.

🟡Against its sector it is priced broadly in line with the peer median of 18.2x.

vs. its own history

Fair

14.7x median over 40 months · +7%

vs. sector peers

Fair

18.2x median of 4 peers · -14%

vs. generic bands

Fair

15x–35x

EV/EBITDA

10.9x

PEG

1.01

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 16.0% to 23.1% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Very low debt
Debt/Equity of 0.23x leaves the balance sheet with plenty of headroom.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention0

Nothing stands out as clearly deteriorating on the years of data available.

Red Flags

2 items require attention · 1 high · 1 watch

🔴Profit up while operating cash flow fallsFinancial
Reported profit rose but cash generated by operations declined — worth checking whether earnings are being supported by non-cash items or working capital.
🟡Receivables growing faster than salesFinancial
Receivables up 23% against revenue up -3% — sales are being booked faster than they are collected.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from 16.0% to 23.1%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Self-funding with balance-sheet headroom
Positive free cash flow of ₹79 Cr alongside low debt means growth, buybacks or dividends need no outside money — and a downturn can be absorbed rather than refinanced.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Sales are being booked faster than collected
Receivables are up 23% against revenue up -3%. If customers keep taking longer to pay, reported profit will not turn into cash — and write-offs follow if some never do.
Size brings its own risk
Micro Cap businesses are thinly traded, so exits are harder in a falling market and single events move the price more than they would for a larger company.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 21%✓ 23.1%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹79 Cr
Profit that never becomes cash eventually stops being profit.
3Debt / EBITDA stays below 2x✓ 1.1x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
4ROCE stays above 13%✓ 16.2%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.
5Valuation vs its own median of 14.7x✓ 15.7x today
A re-rating above its own history needs a reason; without one it is just a higher price.

Investment Checklist

11 / 12 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✓ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 6 neutral · 0 weak

Market Cap

₹4,152 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

15.7x

Fair

Fairly valued against the generic band

P/B Ratio

1.97x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹60.57

Profitable

Profitable on a per-share basis

ROE

12.3%

Moderate

Moderate capital efficiency

ROCE

16.2%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

0.23x

Low

Conservative leverage

Revenue Growth (YoY)

4.9%

Modest

Modest growth

Profit Growth (YoY)

11.9%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.05%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹79 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

11.3x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

16.8%

Good

Healthy core-business profitability

Net Margin

14.2%

Good

Strong bottom-line conversion

Current Ratio

2.14

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.87

Market-like

Moves roughly in line with the market

52W Range Position

82%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

954.8 / 918.4

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

46.5

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹1,874 Cr	₹1,930 Cr	₹1,957 Cr	₹1,813 Cr	-1.1%
EBITDA	₹301 Cr	₹417 Cr	₹425 Cr	₹418 Cr	+11.6%
EBITDA Margin	16.0%	21.6%	21.7%	23.1%	—
PAT (Net Profit)	₹167 Cr	₹249 Cr	₹256 Cr	₹258 Cr	+15.6%
EPS	₹38.26	₹56.99	₹58.7	₹59.07	+15.6%
ROE	11.2%	14.8%	13.5%	12.3%	—
ROCE	14.8%	19.8%	18.7%	16.2%	—
Total Debt	₹506 Cr	₹596 Cr	₹438 Cr	₹475 Cr	-2.1%
Free Cash Flow	-₹237 Cr	-₹253 Cr	₹357 Cr	₹79 Cr	—

🟡 Revenue has been broadly flat over 3 years (-1.1% a year).

🟢 EBITDA has grown at 11.6% a year over 3 years.

🟢 EBITDA Margin has risen from 16.0% to 23.1% over 3 years (+7.0 pts).

🟢 PAT (Net Profit) has grown at 15.6% a year over 3 years.

🟢 EPS has grown at 15.6% a year over 3 years.

🟢 ROE has risen from 11.2% to 12.3% over 3 years (+1.0 pts).

🟢 ROCE has risen from 14.8% to 16.2% over 3 years (+1.3 pts).

🟢 Total Debt has shrunk at 2.1% a year over 3 years.

🟢 Free Cash Flow has turned positive, from -₹237 Cr to ₹79 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹2,996 Cr

Total Liabilities

₹891 Cr

Cash & Equivalents

₹77 Cr

Operating Cash Flow

₹141 Cr

Capex

-₹61 Cr

Shareholding (proxy)

Institutional Holding

11.9%

Insider Holding

65.2%

Corporate Actions

Dividend Rate

₹10

Ex-Dividend Date

31 Jul 2026

Analyst Consensus

Recommendations

1 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹1,128

+18.6% vs CMP

Target Range

₹1,128 – ₹1,128

Peer Comparison

Company	P/E	ROE
TATA STEEL LIMITED	19.8x	10.8%
JSW STEEL LIMITED	12.0x	24.7%
JINDAL STEEL LIMITED	39.1x	5.3%
STEEL AUTHORITY OF INDIA	16.5x	7.1%

Recent News

1 positive5 general

Compare KALYANI STEELS with

Equitymaster, 16 Oct

Kalyani Steels Limited (KSL.NS) Slips 1.67% as Stock Tests Mid-Range Support - Corrective Wave

https://www.siam.in/, 09 Oct

Kalyani Steels Ltd. Shareholding Pattern – Promoters, FIIs & DIIs

Value Research, 29 Aug

Kalyani Steels vs Nifty 50: Share Price Performance Compared

Univest, 01 Oct

Kalyani Steels ₹11,750 Cr Odisha Project Delayed Over Environmental Clearance Hurdles

Sahi, 18 Jun

Interested In Kalyani Steels' (NSE:KSL) Upcoming ₹10.00 Dividend? You Have Three Days Left

Simply Wall Street, 27 JulCapital return

🟢Potentially positiveCash or shares returned to holders. A buyback is only good value if the shares were cheap when bought.

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health · Profitability

MiddlingGrowth · Valuation · Risk

Points for each in the Score ↑

Good business at a fair price

A sound business at a reasonable valuation. Suitable for a long-term holding, with the valuation and the direction of margins worth watching rather than the business itself. 1 high-severity red flag sits above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑