Surani Steel Tubes Limited

Sector n/a · NSE

₹326.85−₹10.85 (−3.21%)

DalalBaazaar Score

48 / 100

🟡 Moderate

Verdict

CAUTION

Risk

Moderate

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

In simple words: The business is earning a fairly low return on the money invested in it, but sales are shrinking. Whether sales start growing again is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 7:03 pm

Understanding the Business

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

How does it make money?

Turns over ₹92 Cr a year. Of every ₹100 of sales, about ₹2 reaches shareholders as profit, with ₹3 left at the operating level before interest, tax and depreciation.

What is its competitive advantage?Little sign of one

Returns on capital of 2.4% are at or below what the capital likely costs. That is the financial pattern of a business competing largely on price, where advantage has to come from execution rather than position.

What has been driving growth?

Profit has moved mainly because margins changed, not because the business sold much more. Over 3 years revenue moved -24% while net margin moved -250% 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-24%

Margin effect-250%

DalalBaazaar Score

48/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Micro Cap: thinner liquidity and sharper drawdowns are normal
✗ Profits have swung sharply from year to year — earnings are hard to forecast

Quality vs. Valuation

Company Quality

51/ 100

Average

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

Valuation

18/ 100

Expensive

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.

vs. its own history

Not enough price and earnings history

vs. sector peers

Not enough peers with a usable P/E

vs. generic bands

No P/E available

EV/EBITDA

201.9x

PEG

—

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from -1.9% to 2.6% over 3 years.
Cash flow has turned positive
Free cash flow moved from negative to positive over 3 years.
Return on equity is rising
ROE has improved from -7.9% to 1.7%.
Return on capital is rising
ROCE has improved from -2.1% to 2.4%.

🔴 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

🔴Inventory building faster than salesFinancial
Inventory up 728% against revenue up -24% — stock may not be moving.
🟡Shareholders have been dilutedOwnership
Shares outstanding are up 88% over 3 years — each existing share owns a smaller slice of the company.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Margin expansion has further to run
EBITDA margin has risen from -1.9% to 2.6%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.

🔴 Bear CaseWhat could go wrong?

Earnings are hard to forecast
Profit has swung sharply from year to year, so any single year — good or bad — is a weak guide to the next. Cyclical earnings deserve lower multiples for that reason.
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 1%✓ 2.6%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Free cash flow remains positive✓ ₹12 Cr
Profit that never becomes cash eventually stops being profit.
3ROCE stays above 8%✗ 2.4%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

4 / 8 checks passed

✗ Strong return on equity (ROE ≥ 15%)
✗ Strong return on capital employed (ROCE ≥ 15%)
✗ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✗ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Short-term technical trend isn't bearish

Price history

Quick Metrics

2 good · 6 neutral · 3 weak

Market Cap

₹508 Cr

Micro Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

Not available

No data

Source didn't return this field

P/B Ratio

Not available

No data

Source didn't return this field

EPS (TTM)

Not available

No data

Source didn't return this field

ROE

1.7%

Weak

Weak capital efficiency

ROCE

2.4%

Weak

Low return on total capital employed

Debt/Equity

Not available

No data

Source didn't return this field

Revenue Growth (YoY)

-59.0%

Shrinking

Sales are contracting

Profit Growth (YoY)

321.4%

Healthy

Profits growing at a healthy clip

Dividend Yield

None

No dividend yield reported — usually means no payout, but verify if one was recently initiated

Free Cash Flow

₹12 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

Gross Margin

2.8%

Proxy

Operating margin unavailable — showing gross margin instead

Net Margin

2.2%

Weak

Very little revenue reaches the bottom line

Current Ratio

1.89

Comfortable

Healthy short-term liquidity

Technical Snapshot

SMA 20 / SMA 50

121.1 / 106.4

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

68.4

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹121 Cr	₹153 Cr	₹225 Cr	₹92 Cr	-8.6%
EBITDA	-₹2 Cr	-₹1 Cr	₹4 Cr	₹2 Cr	—
EBITDA Margin	-1.9%	-0.9%	1.6%	2.6%	—
PAT (Net Profit)	-₹2 Cr	₹1 Cr	₹0 Cr	₹2 Cr	—
EPS	₹-2.16	₹0.44	₹0.38	—	—
ROE	-7.9%	0.6%	0.4%	1.7%	—
ROCE	-2.1%	0.7%	0.1%	2.4%	—
Total Debt	₹11 Cr	₹42 Cr	₹35 Cr	—	—
Free Cash Flow	-₹2 Cr	-₹63 Cr	₹7 Cr	₹12 Cr	—

🔴 Revenue has shrunk at 8.6% a year over 3 years.

🟢 EBITDA has turned positive, from -₹2 Cr to ₹2 Cr.

🟢 EBITDA Margin has risen from -1.9% to 2.6% over 3 years (+4.5 pts).

🟢 PAT (Net Profit) has turned positive, from -₹2 Cr to ₹2 Cr.

🟢 ROE has risen from -7.9% to 1.7% over 3 years (+9.5 pts).

🟢 ROCE has risen from -2.1% to 2.4% over 3 years (+4.5 pts).

🟢 Free Cash Flow has turned positive, from -₹2 Cr to ₹12 Cr.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹251 Cr

Total Liabilities

₹127 Cr

Cash & Equivalents

₹18 Cr

Operating Cash Flow

₹13 Cr

Capex

-₹1 Cr

Recent News

2 mixed4 general

Surani Steel Tubes Lower Circuit Streak: Day 2 Price and Data

Univest, 15 Oct

Surani Steel Tubes Lower Circuit Today: Price, Data and Peers

Univest, 14 Oct

Surani Steel Tubes Ltd. Upper Circuit Today: Price, Data and Peers

Univest, 05 Oct

Surani Steel Tubes (NSEI:SURANI) Stock Forecast & Analyst Predictions

Simply Wall Street, 14 NovAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

Surani Steel Tubes Ltd. Share Price News and Price Rise

Univest, 21 AugPrice move

🟡Mixed / dependsA price move, which is not by itself a change in the business. Worth finding the cause before reading it as either good or bad.

VSTL Stock Price and Chart — NSE:VSTL

TradingView, 20 Feb

Watch Items

Revenue growth is negative (-59.0%) on the latest reported period — check if this is one-off or a trend.
Cross-check against the company's latest quarterly filing / investor presentation before acting.
Sector/industry classification unavailable — verify manually for peer comparison.
4 metrics couldn't be retrieved for this stock — this is more common for smaller or thinly-covered listings.

DalalBaazaar Thesis

StrongFinancial Health

MiddlingProfitability · Valuation

WeakBusiness Quality · Growth · Risk

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 1 high-severity red flag sits above this conclusion and should be read first.

1 of 3 tripwires tripped — ROCE stays above 8% · see Key things to watch ↑