🧠 At a Glance
Remi Edelstahl Tubulars manufactures stainless steel pipes and tubes — the unsexy backbone of oil & gas, power, and industrial machinery. But while their products can handle 600°C steam and 80mm pipe thickness, the stock has been delivering performance at room temperature. With low ROE, lumpy profits, and low growth — is this a turnaround bet or a legacy pipe dream?
1. 🪓 Introduction with Hook
If you’ve ever wondered what happens when an engineering company forgets marketing, IPO hype, and dividends — meet Remi Edelstahl.
This is the story of a 50-year-old stainless steel pipe company that makes precision heat exchanger tubes but couldn’t exchange much investor heat until recently.
Stock is up 40% in 3 years. But is it real strength or just hot air in cold pipes?
2. 🏭 WTF Do They Even Do?
- Core Business: Manufacturing of stainless steel seamless and welded pipes & tubes
- Products:
- Seamless: Boiler tubes, heat exchangers, instrumentation tubes
- Welded: Pipes up to 80-inch diameter, 80mm wall thickness
- Sectors served: Oil & gas, power, water treatment, pharma
- Materials: Super Duplex Steel, Nickel, Titanium — sounds premium, but the margins aren’t
Basically, they sell the kind of stuff that goes inside a refinery, not the stuff that refiners sell to you. B2B, capital goods, precision metal — high entry barrier, low glamour.
3. 📊 Financials Overview – Profit, Margins, ROE, Growth
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | ₹135 Cr | ₹117 Cr | ₹139 Cr |
| EBITDA Margin | 4% | 5% | 6% |
| Net Profit | ₹0.2 Cr | ₹1.3 Cr | ₹2.8 Cr |
| ROE | 0.6% | 4.0% | 6.0% |
| 3Y Sales CAGR | 9% | ||
| 3Y PAT CAGR | 61% |
- Profits have improved thanks to better working capital & lower debt
- Margins still wafer-thin
- Remi is profitable now — but not exactly rolling in stainless cash
4. 💸 Valuation – Is It Cheap, Meh, or Crack?
- Current Price: ₹94.8
- Market Cap: ₹104 Cr
- P/E: ~39x (TTM PAT of ₹2.67 Cr)
- Book Value: ₹41.9 → P/B of 2.27x
🧮 Fair Value Range Estimate (EduInvesting style):
Let’s be kind and assume:
- Normalized PAT = ₹3.5 Cr
- Fair P/E = 20x (for a commodity B2B with 5–6% margins)
That gives us a fair value of:
pgsqlCopyEdit₹3.5 Cr x 20 = ₹70 Cr → ₹64–75 range on market cap
→ FV/share range = ₹58–68
So at ₹94.8, the stock is:
📌 Trading ~40% above our fair value zone
Unless growth or margin expansion accelerates, this is looking mildly frothy.
5. 🍳 What’s Cooking – News, Triggers, Drama
- 🔧 Working Capital Turnaround: WC days reduced from 162 → 94
- 📉 Debt Reduction: From ₹30 Cr in FY24 to ₹15 Cr in FY25
- 📈 Improved OPMs: Q4 FY25 OPM was 4.3% vs negative territory earlier
- 📣 More Shareholders: From 3.5k to 4.5k in 1 year – some retail crowd now sniffing turnaround
But no expansion announcements, capex plans, or big orders yet.
6. 🧾 Balance Sheet – How Much Debt, How Many Dreams?
| Year | Borrowings | Reserves | Net Worth | D/E |
|---|---|---|---|---|
| FY23 | ₹24 Cr | ₹31 Cr | ₹42 Cr | 0.57x |
| FY25 | ₹15 Cr | ₹35 Cr | ₹46 Cr | 0.33x |
- Decent deleveraging
- Steady increase in reserves
- Fixed asset base tiny (~₹25 Cr) → not a large-scale play
7. 💰 Cash Flow – Sab Number Game Hai
| Year | CFO | FCF | CFI | CFF |
|---|---|---|---|---|
| FY25 | ₹24 Cr | ~₹20 Cr | -₹6 Cr | -₹18 Cr |
- Strong operating cash thanks to reduced receivables & better cycle
- They used it to pay back debt — ✅ sensible capital allocation
No dividend payout though — not even ₹1 since inception. Bro, kuch toh return do.
8. 📐 Ratios – Sexy or Stressy?
| Metric | Value |
|---|---|
| ROCE | 7.26% |
| ROE | 5.97% |
| OPM | 6% |
| Inventory Days | 103 |
| Debtor Days | 44 |
| Working Capital Days | 94 |
| Cash Conversion Cycle | 120 |
Some cleanup here — debtor and inventory days are improving, which supports margins. But still not “sexy” by any means.
9. 📊 P&L Breakdown – Show Me the Money
| FY25 (₹ Cr) | Value |
|---|---|
| Revenue | 139 |
| Operating Profit | 8 |
| Interest | 1 |
| Depreciation | 4 |
| Net Profit | 2.8 |
The difference between EBITDA and PAT is… significant. Not enough operating leverage yet. ₹8 Cr EBITDA becoming ₹2.8 Cr PAT – that’s tight.
10. 🥊 Peer Comparison – Who Else in the Game?
| Company | ROCE | P/E | Mkt Cap (₹ Cr) |
|---|---|---|---|
| APL Apollo | 22.8% | 63x | ₹48,150 Cr |
| Ratnamani | 21.5% | 37x | ₹20,250 Cr |
| Welspun Corp | 25.6% | 16x | ₹24,449 Cr |
| Jindal Saw | 19.3% | 10x | ₹14,990 Cr |
| Remi Edelstahl | 7.3% | 39x | ₹104 Cr |
Remi has the lowest ROE/ROCE and yet trades at a premium P/E. That’s not valuation — that’s optimism overdose.
11. 🧠 Miscellaneous – Shareholding, Promoters
- Promoter Holding: 74.69% (stable)
- No FII/DII activity
- Public Shareholders: 25.3% and increasing
- # of Shareholders: Jumped from 3,500 → 4,500+ in a year
So someone is building conviction. Or just chasing momentum.
Also, CRISIL & CARE both provide regular credit ratings – not junk territory, but not investment-grade glam either.
12. 🔮 EduInvesting Verdict™
Remi Edelstahl is like a middle-class Indian uncle who quietly pays off his EMIs, improves his health metrics, and upgrades from Bajaj Chetak to Activa — but still hasn’t joined the startup party.
- ✅ Profitable
- ✅ Low debt
- ✅ Improving WC and cash flows
- ❌ Low growth
- ❌ Thin margins
- ❌ Overvalued P/E
🔎 Verdict: Decent turnaround in progress — but the valuation assumes it’s already a Ratnamani 2.0. We’re not so sure yet. A sober hold, not a momentum rocket.
🎯 Fair Value Range: ₹58 – ₹68
🚫 EduInvesting does not recommend buy/sell. We just tell you what the numbers are whispering.
✍️ Written by Prashant | 📅 July 3, 2025
📌 Tags: Remi Edelstahl, stainless steel pipes, industrial B2B stocks, turnaround stock, pipe manufacturing, Ratnamani Metals, value trap or value pick, EduInvesting stock analysis
