Transcript of the conference call held on May 19, 2025
SGMART · price
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SG Mart reported its first full year of operations with revenue of INR 5,800 crores, EBITDA of INR 103 crores, and net profit of INR 103 crores in FY25. Management guided for EBITDA to double to INR 200 crores in FY26 and double again to INR 400 crores in FY27, maintaining a minimum 25% ROCE. The company operates four verticals: B2B metal trading (50,000 tons/month), service centres (5 operational, 5 more planned), solar structures under the 'Sun Steel' brand (50,000 tons of order visibility for FY26), and distribution business where TMT has shifted to a royalty model at INR 500/ton, targeted to rise to INR 1,000/ton. A INR 600 crore board-approved capex over 3-4 years for service centres will be fully funded from internal cash flows with no need for debt or external capital. INR 250 crores from warrant conversion is expected shortly.
Strong growth guidance and a capital-light royalty model shift could drive margin expansion and earnings doubling, which is positive for shareholders. However, FY27 targets are ambitious and depend on execution across multiple new verticals.