At a Glance
Sudal Industries, once on the edge of collapse (literally under Insolvency), is back with a vengeance. FY25 saw it clock ₹155 Cr revenue and ₹6 Cr profit, with OPM hitting 8% and ROE/ROCE above 25%. But promoters have pledged 82% of holdings, and sales have barely grown. So, is this a legit turnaround or just a lucky Supreme Court stay order?
1. 🪛 Introduction with Hook
From bankruptcy filings in FY23 to ₹6 Cr PAT in FY25.
From negative reserves to ₹16 Cr.
From Pre-Packaged Insolvency to ₹81/share.
This isn’t a turnaround. It’s a corporate thriller with aluminum billets, legal drama, and some weird “other income” plot twists.
2. 🏭 WTF Do They Even Do?
🧊 Core Business:
- Aluminium alloy & extrusion manufacturing
- Takes aluminum ingots → melts → casts into billets → extrudes into industrial parts
- Used in:
- Automotive
- Electricals
- Railways
- Infrastructure
It’s boring. But also essential.
⚠️ Unlike Hindalco, this is a pure-play midstream extrusion player.
3. 💰 Financials Overview – Profit, Margins, ROE, Growth
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | ₹160 Cr | ₹144 Cr | ₹155 Cr |
| EBITDA | ₹4 Cr | ₹8 Cr | ₹12 Cr |
| Net Profit | -₹33 Cr | ₹121 Cr* | ₹6 Cr |
| OPM | 3% | 5% | 8% |
| ROE | NA | NA | 25.8% |
| ROCE | 2.3% | 8% | 24.5% |
*FY24 includes one-time ₹125 Cr other income, likely related to insolvency resolution accounting.
4. 📊 Valuation – Is It Cheap, Meh, or Crack?
- CMP: ₹81.4
- Market Cap: ₹60 Cr
- EPS (FY25): ₹7.74
- P/E: 10.5x
- P/B: 2.4x (BV = ₹33.8)
Not ultra-cheap, but reasonable for a cleaned-up industrial player with high operating leverage.
5. ⚖️ What’s Cooking – News, Triggers, Drama
🧨 2023–2024: INSOLVENCY SAGA
- Company entered Pre-Packaged Insolvency Resolution Process (PPIRP) under IBC
- NCLT approved revival plan in Aug 2023
- Equity allotment of 10 lakh shares post-resolution
- Supreme Court stayed a GST ITC reversal order of ₹25.78 Cr in Oct 2024
⚠️ So yes, it’s had more court dates than quarterly investor calls.
6. 🧾 Balance Sheet – How Much Debt, How Many Dreams?
| FY23 | FY24 | FY25 |
|---|---|---|
| Reserves | -₹110 Cr | ₹11 Cr |
| Total Debt | ₹34 Cr | ₹22 Cr |
| Total Liabilities | ₹61 Cr | ₹56 Cr |
| Fixed Assets | ₹32 Cr | ₹34 Cr |
| Net Worth | Positive again! |
Basically, the company has restructured its balance sheet and come out leaner.
7. 💵 Cash Flow – Sab Number Game Hai
| FY25 | ₹ Cr |
|---|---|
| CFO | ₹10 Cr |
| FCF | Positive |
| Capex | ₹3 Cr |
| Financing | -₹6 Cr (debt repayment) |
Finally, cash is staying in the business, not leaking into default notices.
8. 📐 Ratios – Sexy or Stressy?
| Ratio | FY25 |
|---|---|
| ROE | 25.8% ✅ |
| ROCE | 24.5% ✅ |
| OPM | 8% |
| EPS | ₹7.74 |
| Debt/Equity | ~1.3x (improving) |
| CCC | 22 days |
| Inventory Days | 35 |
| Debtor Days | 26 |
| Creditor Days | 39 |
🔍 Looks efficient now. But high D/E is still a risk.
9. 💥 P&L Breakdown – Show Me the Money
| FY25 | ₹ Cr |
|---|---|
| Revenue | ₹155 Cr |
| Operating Profit | ₹12 Cr |
| Other Income | ₹0 |
| Net Profit | ₹6 Cr |
| EPS | ₹7.74 |
FY24’s ₹121 Cr PAT = one-time writebacks.
FY25 = core operating profit. That’s important.
10. 🏁 Peer Comparison – Who Else in the Game?
| Company | Rev (Cr) | ROE | ROCE | P/E | MCap (Cr) |
|---|---|---|---|---|---|
| Maan Aluminium | ₹810 Cr | 9.1% | 10.7% | 42x | ₹655 Cr |
| MMP Ind. | ₹692 Cr | 12.7% | 14.2% | 18.7x | ₹727 Cr |
| Arfin India | ₹615 Cr | 7.2% | 14% | 46x | ₹423 Cr |
| Sudal Ind. | ₹155 Cr | 25.8% | 24.5% | 10.5x | ₹60 Cr |
⚡ Despite being the smallest, Sudal is posting better returns than all. But volumes are lower.
11. 🧪 Miscellaneous – Shareholding, Promoters
- Promoter holding: 67.44% ✅
- BUT 82.3% is pledged 😱
- Public holding: 32.5%
- No DII/FII presence
- 10,000 shareholders
Pledging is the elephant in the room.
12. 📦 EduInvesting Verdict™
“This isn’t a turnaround story. This is a near-death experience.”
✅ Cleaned balance sheet
✅ Back in profit
✅ High ROE/ROCE
✅ Cheap-ish valuations
❌ Promoter pledging = 🚨
❌ No sales growth for 5 years
❌ Legal shadow still looms
If it keeps this profit level for 2+ years, this stock deserves a rerate.
But if the legal issues return or demand slumps, it’s back to square one.
13. 💸 Fair Value Estimate (FV Range)
Assume sustainable EPS of ₹6–₹7.5 and P/E of 10–14x (based on peers like Maan):
| Scenario | EPS | P/E Range | FV Range |
|---|---|---|---|
| Base Case | ₹6 | 10–12x | ₹60 – ₹72 |
| Bull Case | ₹7.5 | 12–14x | ₹90 – ₹105 |
| Bear Case | ₹5 | 8x | ₹40 |
🧮 EduInvesting FV Range: ₹60 – ₹95, assuming operational stability holds and no legal disaster.
✍️ Written by Prashant | 📅 9 July 2025
Tags: Sudal Industries, Insolvency Turnaround, Aluminium Stocks, Pledged Shares, Supreme Court Stay, Pre-Pack IBC, EduInvesting
