The iron and steel industry plays a crucial role in India’s industrial framework. In January 2019, India surpassed Japan and became the world’s second-largest producer of steel.
Ashirwad Steels & Industries Ltd. stands as a prominent figure in the Indian iron and steel sector, distinguished for its specialised production of sponge iron. This company has firmly established itself as a cornerstone in the industry, earning a reputation for its manufacturing prowess and quality products.
The FY 24Q4 results sparked a series of events in the stock market, leading to a significant increase in the share prices of Ashirwad Steels & Industries. This article will explore the company’s quarterly performance and the market’s response in detail.
Also read: How does the iron and steel industry shape India’s economy?
Ashirwad Steels & Industries Profile
Ashirwad Steels & Industries Limited is an Indian company that specialises in manufacturing sponge iron. They use iron-ore and coal as their raw materials. The company operates primarily in the iron and steel products.
The company produces and supplies sponge iron, which is a key component in producing finished steel and bottles of hydrocarbon/liquefied petroleum gas (LPG). The sponge iron is a crucial component for the Steel Melting Shops (induction furnaces) in producing steel billets/ingots. These billets/ingots are then re-rolled by the rolling mills to create a variety of steel products, including TMT Rods/Bars, Plain Rounds, Angles, Flats, Channels, and Girders.
The company operates two bottling plants, one in Uluberia, Howrah, West Bengal and the other in Raigarh, Chhattisgarh. The company also operates two sponge iron plants situated in Jharkhand and Andhra Pradesh.
Ashirwad Steels & Industries currently has a market capitalisation of ₹81.09 crore.
Ashirwad Steels & Industries Q4 Results
Here are some of the key financial metrics of the recent quarter results as compared to the same quarter previous year:
| Q4 FY24 | Q4 FY23 | Q-o-Q change | |
| Net revenue (₹ crores) | 0.86 | 0.32 | 168.75% |
| Operating profit (₹ crores) | 0.58 | 0.16 | 262.5% |
| Profit before tax (₹ crores) | 1.33 | 0.76 | 75% |
| Net profit (₹ crores) | 0.90 | 0.55 | 63.64% |
| EPS (₹) | 0.72 | 0.44 | 70.45% |
Source: Screener
The company’s financial performance in the fourth quarter of FY24 showed a substantial improvement across all key metrics compared to the same quarter in the previous fiscal year. This positive trend indicates a robust quarter for the company, reflecting successful strategies and operations that have led to enhanced financial outcomes.
Must read: JSW Energy sparks a 6% surge in share price after Q4 earnings release!
Ashirwad Steels & Industries Annual performance
Here are some of the key financial metrics of the annual results as compared to the previous year:
| FY24 | FY23 | Y-o-Y change | |
| Net revenue (₹ crores) | 1.59 | 2.11 | -24.64% |
| Operating profit (₹ crores) | 0.51 | 0.95 | -46.31% |
| Profit before tax (₹ crores) | 3.18 | 18.66 | -79.59% |
| Net profit (₹ crores) | 2.26 | 16.77 | -86.52% |
| EPS (₹) | 1.81 | 13.42 | -86.51% |
Source: Screener
In comparison to FY23, the company’s financial performance in FY24 was lower across the board. The year-over-year change indicates a negative trend, suggesting challenges that have impacted the company’s profitability and overall financial health.
Stock market reaction to Ashirwad Steels & Industries
The company released its quarter 4 of the fiscal year 2024 results on May 7, 2024. Following the announcement, the share price experienced a jump from ₹42.10 to ₹51.66, marking a growth of 22.7% the next day.
As of May 11, 2024, the share price of the corporation is ₹64.87. When looking at the share price history of the company for the past 5 days, the trading pattern clearly indicates the surge after the quarterly results:
Source: Google Finance
The enthusiastic response from the market to the Q4 financial disclosures, marked by a notable rise in the stock value, signifies the investors’ trust in the company’s robust performance and promising outlook.
Also read: Investor Alert: 9% Decline in Share Price Post Coforge’s Q4 Earnings
Peer comparison
Let’s compare the Ashirwad Steels & Industries Ltd’s key financials with its competitors:
| Ashirwad Steels & Industries Ltd(FY 2024) | Incredible Industries Ltd(TTM) | Ahlada Engineers Ltd(TTM) | Vaswani Industries Ltd(TTM) | |
| Market cap (₹ crores) | 81.1 | 183 | 151 | 97.8 |
| P/E | 35.9 | 31.7 | 14.7 | 13.8 |
| ROCE (%) | 4.07 | 7.27 | 8.01 | 12.5 |
| Earnings yield (%) | 4.12 | 6.50 | 10.5 | 14.2 |
| PEG ratio | 1.52 | 159 | -1.67 | 2.32 |
| EPS (₹) | 1.81 | 1.23 | 7.93 | 2.35 |
Source: Screener
Bottomline
Ashirwad Steels & Industries Ltd. has showcased a commendable performance in the fourth quarter of the fiscal year 2024, characterised by substantial enhancements in crucial financial indicators compared to the corresponding period in the preceding fiscal year.
Nevertheless, in spite of the robust performance in Q4 FY24, the yearly results for the fiscal year indicate a decline in several financial metrics compared to the prior year.
The optimistic response from the market following the disclosure of Q4 results, as manifested by the significant rise in share price, mirrors the investor’s faith in the company’s performance and future potential.
