1. At a Glance – Blink and You’ll Miss the Equity
Visa Steel Ltd is not a stock, it’s a financial thriller. Market cap of roughly ₹440 crore, trading near ₹38, while carrying ₹1,396 crore of debt, a negative book value of ₹-119, and ROCE of -5.46%. Promoters hold 57.6%, but a chunky 59.6% of that is pledged, which is basically equity wearing a neck brace.
The company’s latest quarter delivered ₹145 crore in sales and a loss of ₹16.5 crore, continuing a long tradition of “operational continuity without profitability.” The most fascinating part? In FY23, Visa Steel booked a notional gain of ₹1,748 crore due to loss of control over subsidiaries — a profit that looked great on paper and did absolutely nothing for cash flows.
Over the last 3 months, the stock is down 35%, yet over 3 years it’s up 41%. This is not value investing — this is volatility yoga.
Question before we begin: Are we analysing a steel company, or a legal-document-management firm specialising in debt resolutions?
2. Introduction – A Company That Refuses to Die (Financially)
Visa Steel Ltd was incorporated in 1996, with the noble intention of manufacturing High Carbon Ferro Chrome, a key alloy used in stainless steel. Fast forward to today, and the company is still alive — not thriving, not growing, but operating under a “conversion arrangement”, which is corporate-speak for “we don’t have money, but please let us keep the lights on.”
For more than a decade, Visa Steel has lived in a state of financial emergency. Debt restructuring attempts in 2012 and 2014 failed, not because plans were bad, but because lenders sanctioned facilities and then didn’t disburse them. Interest piled up, working capital evaporated, and losses became a lifestyle choice.
By November 2022, the inevitable happened: CIRP was admitted by NCLT. Since then, the company has survived on related-party support, operational creditors, and sheer stubbornness.
So why does the market still care?
Because sometimes, in Indian markets, survival itself becomes a narrative.
Ask yourself honestly: Is this a turnaround story, or just a very long
postponement?
3. Business Model – WTF Do They Even Do?
Originally, Visa Steel’s business was simple: manufacture ferro chrome, sell ferro chrome, make money. Somewhere along the way, the last step disappeared.
Manufacturing Setup
- 125,000 TPA ferro chrome plant at Kalinganagar, Odisha
- 5 Submerged Arc Furnaces
- 3 × 25 MW captive power units
On paper, this is a serious industrial setup. In reality, the plant operates under conversion arrangements, meaning third parties use the facility, and Visa Steel earns conversion income instead of product margins.
Revenue Reality – FY23
- Conversion Income: ~94%
- Manufactured Goods: ~3%
- Other Operating Income: ~3%
So yes, Visa Steel is technically a manufacturer, but economically, it’s closer to a factory-for-rent.
Segment-wise FY23:
- Ferro Alloys: 82%
- Special Steel: 18%
This is not vertical integration. This is industrial survival mode.
Be honest: If 94% of revenue is conversion income, are we even analysing a steel cycle company anymore?
4. Financials Overview – Losses with Occasional Fireworks
Quarterly Comparison (Consolidated, ₹ crore)
| Metric | Latest Qtr (Dec’25) | Same Qtr LY | Prev Qtr | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 145 | 119 | 75 | +22.1% | +93% |
| EBITDA | -1 | 3 | -10 | NA | NA |
| PAT | -16.5 | -17 | -20 | +4.3% | +17.5% |
| EPS (₹) | -1.43 | -1.49 | -1.75 | +4% | +18% |
Yes, losses improved. No, profitability didn’t arrive.
The FY23 Optical Illusion
- Other income of ₹1,748 crore
- Caused by loss of control over subsidiaries
- Purely notional
- Zero help to cash flows
It’s like selling your house, booking profit, and still sleeping on the footpath.
Question time: How many years of “reduced losses” does it take before equity stops eroding?
