Usha Martin Limited

Basic Materials — Steel · NSE

₹491.50+₹8.60 (+1.78%)

DalalBaazaar Score

62 / 100

🟢 Good

Verdict

REASONABLE

Risk

Moderate

Driven by high debt relative to equity, small-cap size, which brings sharper price swings.

In simple words: Strong business and financial position, with both sales and profits growing well. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:06 pm

Mixed / neutral. No major red flags jump out, but nothing here screams "obviously cheap" either. This is a name that needs a peer comparison and a view on near-term earnings triggers before sizing a position.

Understanding the Business

Company site ↗

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

What does this company do?

Usha Martin Limited, together with its subsidiaries, manufactures and sells steel wires, strands, wire ropes, wire drawing and allied machine, cord, and related accessories in India and internationally.

IndustrySteel

SectorBasic Materials

Employees2,234

Annual revenue₹3,596 Cr

How does it make money?

Turns over ₹3,596 Cr a year. Of every ₹100 of sales, about ₹13 reaches shareholders as profit, with ₹21 left at the operating level before interest, tax and depreciation. Each of its 2,234 employees supports ₹1.61 Cr of revenue a year, the signature of a capital- or asset-led business.

EBITDA margin21.3%

Net margin13.0%

Revenue / employee₹1.61 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.

TATA STEEL LIMITEDP/E 19.8x · ROE 10.8%

JSW STEEL LIMITEDP/E 12.0x · ROE 24.7%

JINDAL STEEL LIMITEDP/E 39.1x · ROE 5.3%

STEEL AUTHORITY OF INDIAP/E 16.5x · ROE 7.1%

What is its competitive advantage?Some evidence

ROCE of 18.7% is above what capital typically costs, which suggests some pricing power, though not yet the sustained, wide gap that marks a durable advantage.

ROCE18.7%

ROE14.1%

Peer median ROE10.8%

What is the outlook?

4 analysts covering the stock expect revenue to grow about 11.5% and earnings to grow about 14.2% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+11.5%

Est. earnings growth+14.2%

Analysts4

What has been driving growth?

Sales and margins have both contributed to where profit is now. Over 3 years revenue moved +13% while net margin moved +18% 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+13%

Margin effect+18%

DalalBaazaar Score

62/ 100

Good

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 4.1% — barely ahead of inflation
• Profit CAGR of 10.0%

Quality vs. Valuation

Company Quality

64/ 100

Average

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

Valuation

41/ 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.

Historical Valuation

Current P/E

28.2x

3Y Median

30.6x

40 monthly readings · mean 29.8x · range 20.8x–37.8x

Sector Median

18.2x

median of 4 sector peers

🟡Currently trading close to its 3y median of 30.6x — the market is paying about what it usually pays for this company.

⚠️Against its sector it trades 55% above the peer median of 18.2x.

vs. its own history

Fair

30.6x median over 40 months · -8%

vs. sector peers

Expensive

18.2x median of 4 peers · +55%

vs. generic bands

Fair

15x–35x

P/E (Trailing)

28.2x

P/B

4.53x

EV/EBITDA

19.5x

PEG

2.82

Dividend Yield

0.76%

What's Good / What's Bad

🟢 What's Going Well4

Margins are improving
EBITDA margin is up from 17.3% to 21.3% over 3 years.
Debt is being paid down
Total debt is down 45% over 3 years.
Cash generation is improving
Free cash flow is up 560% over 3 years.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention1

Return on equity is falling
ROE has dropped from 17.2% to 14.1% — each rupee of shareholder capital earns less than it did.

Red Flags

1 item require attention · 1 high

🔴High leverageFinancial
Debt/Equity of 6.92x — earnings must service borrowings before shareholders see anything.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 18.7% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Margin expansion has further to run
EBITDA margin has risen from 17.3% to 21.3%. If that holds, profit compounds faster than sales and today's multiple looks cheaper in hindsight than it does now.
Deleveraging frees up earnings
Debt is down 45% over 3 years. Every rupee of interest not paid drops to the bottom line, so profit can grow even if revenue does not.
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?

Leverage amplifies any setback
Debt/Equity of 6.92x. Interest is payable whether or not the business has a good year.
A premium to the sector to defend
It trades 55% above the peer median. That premium needs a reason that persists, or it closes.
Growth barely outpaces inflation
Revenue compounding at 4.1% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
Returns on shareholder capital are falling
ROE has dropped from 17.2% to 14.1%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
Size brings its own risk
Small 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 19%✓ 21.3%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 4% a year✓ 4.1% CAGR
Latest reported year was 16.4%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹457 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.3x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 16%✓ 18.7%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

10 / 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 · 5 neutral · 1 weak

Market Cap

₹14,961 Cr

Small Cap

Smaller company — thin liquidity and deep drawdowns are normal here

P/E (Trailing)

28.2x

Fair

Fairly valued against the generic band

P/B Ratio

4.53x

Fair

Moderate premium to the company's book value

EPS (TTM)

₹17.46

Profitable

Profitable on a per-share basis

ROE

14.1%

Moderate

Moderate capital efficiency

ROCE

18.7%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

6.92x

High

High leverage

Revenue Growth (YoY)

16.4%

Healthy

Healthy top-line growth

Profit Growth (YoY)

40.8%

Healthy

Profits growing at a healthy clip

Dividend Yield

0.76%

Modest

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

Free Cash Flow

₹457 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

CMP

₹491.5

P/E (Forward)

21.6x

Improving

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

Operating Margin

16.9%

Good

Healthy core-business profitability

Net Margin

13.2%

Good

Strong bottom-line conversion

Current Ratio

3.28

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.33

Defensive

Steadier than the market

52W Range Position

69%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

506.5 / 501.6

Bullish alignment (short > long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

37.4

Neutral momentum

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹3,187 Cr	₹3,138 Cr	₹3,383 Cr	₹3,596 Cr	+4.1%
EBITDA	₹550 Cr	₹633 Cr	₹650 Cr	₹767 Cr	+11.7%
EBITDA Margin	17.3%	20.2%	19.2%	21.3%	—
PAT (Net Profit)	₹350 Cr	₹424 Cr	₹407 Cr	₹466 Cr	+10.0%
EPS	₹11.51	₹13.92	₹13.37	₹15.29	+9.9%
ROE	17.2%	17.8%	14.8%	14.1%	—
ROCE	20.3%	21.0%	18.1%	18.7%	—
Total Debt	₹417 Cr	₹364 Cr	₹417 Cr	₹229 Cr	-18.1%
Free Cash Flow	₹69 Cr	₹166 Cr	₹177 Cr	₹457 Cr	+87.6%

🟢 Revenue has grown at 4.1% a year over 3 years.

🟢 EBITDA has grown at 11.7% a year over 3 years.

🟢 EBITDA Margin has risen from 17.3% to 21.3% over 3 years (+4.1 pts).

🟢 PAT (Net Profit) has grown at 10.0% a year over 3 years.

🟢 EPS has grown at 9.9% a year over 3 years.

🔴 ROE has fallen from 17.2% to 14.1% over 3 years (-3.1 pts).

🔴 ROCE has fallen from 20.3% to 18.7% over 3 years (-1.6 pts).

🟢 Total Debt has shrunk at 18.1% a year over 3 years.

🟢 Free Cash Flow has grown at 87.6% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹4,212 Cr

Total Liabilities

₹910 Cr

Total Debt

₹229 Cr

Cash & Equivalents

₹242 Cr

Operating Cash Flow

₹655 Cr

Capex

-₹198 Cr

Shareholding (proxy)

Institutional Holding

28.9%

Insider Holding

40.2%

Corporate Actions

Dividend Rate

₹3.75

Ex-Dividend Date

13 Aug 2026

Analyst Consensus

Recommendations

4 Buy · 0 Hold · 0 Sell

Target Price (Mean)

₹616.5

+25.4% vs CMP

Target Range

₹596 – ₹650

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 positive1 mixed4 general

Compare USHA MARTIN with

Equitymaster, 16 Oct

Usha Martin Share Price near 52-week high and valuation

Univest, 23 Sept

Is It Smart To Buy Usha Martin Limited (NSE:USHAMART) Before It Goes Ex-Dividend?

Simply Wall Street, 09 AugCapital return

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

Top 2 stocks to buy for short-term: Bank of Maharashtra, Usha Martin by Nagaraj Shetti - Check stop loss, targets

Livemint, 07 Oct

Trade Spotlight: How should you trade Usha Martin, Carborundum Universal, Engineers India, Lumax Auto...

Moneycontrol.com, 23 Sept

USHAMART Forecast — Price Target — Prediction for 2027

TradingView, 25 JunAnalyst view

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

Watch Items

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

DalalBaazaar Thesis

🟢Business QualityStrong14.6/20

🟢Financial HealthStrong14.5/20

🟡GrowthModest10.4/20

🟡ProfitabilityModerate8.2/15

🟡ValuationFair8.1/15

🟡RiskModerate5.7/10

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.

This thesis breaks if

✓EBITDA margin holds above 19%21.3%
✓Revenue growth stays above 4% a year4.1% CAGR
✓Free cash flow remains positive₹457 Cr
✓Debt / EBITDA stays below 2x0.3x
✓ROCE stays above 16%18.7%