1. At a Glance
Indian Metals & Ferro Alloys Ltd (IMFA) is what happens when a ferrochrome company decides to do everything itself — mine the ore, smelt it, generate its own power, export it, and still complain about cycles. As of today, IMFA sits at a market cap of ₹7,390 Cr, trading around ₹1,370, after delivering a jaw-dropping ~81% return in just 6 months. Stainless steel demand sneezes somewhere in China, and IMFA’s P&L catches a cold or a fever — depending on which way prices move.
The latest Q3 FY26 numbers show ₹702.8 Cr revenue, ₹131.5 Cr PAT, and an EPS of ₹24.33, translating into a headline 40.7% YoY profit growth. ROCE is cruising at 21.3%, debt-to-equity is a conservative 0.17, and the company still pays dividends like a disciplined PSU uncle (1.43% yield). Exports form a ridiculous 96% of revenue, meaning IMFA earns in dollars but lives with Indian electricity bills.
But here’s the spice: IMFA is not just riding the cycle — it’s buying the cycle. A ₹610 Cr acquisition of Tata Steel’s Kalinga Nagar ferrochrome plant, a 100,000 TPA expansion, renewable power tie-ups, and captive mining till 2055. This is not a sleepy metal stock anymore. This is a fully caffeinated alloy machine.
So the question is simple: is IMFA a smart cyclical compounder or just a very well-dressed commodity play? Let’s dig.
2. Introduction
IMFA was founded in 1961, which means it has survived more commodity cycles than most investors have survived bear markets. Ferrochrome is a dirty, cyclical, capital-intensive business that swings wildly with stainless steel demand — and IMFA has chosen to stay here voluntarily. That alone tells you something about management’s risk appetite.
India consumes ferrochrome, but not nearly enough. So IMFA exports 96% of what it produces, primarily to China, Japan, Taiwan, and Korea. In effect, IMFA’s fate is linked more to Chinese stainless steel melt shops than Indian GDP numbers. When global prices are good, IMFA prints money. When prices collapse, margins evaporate faster than optimism in a midcap Telegram group.
What makes IMFA different is integration. It owns chrome ore mines at Sukinda and Mahagiri, has 190 MVA smelting capacity, and 204.55 MW of captive power. This lowers costs and cushions margins during downturns. Most ferrochrome players buy ore and power externally. IMFA doesn’t like dependencies.
Over the last few years, IMFA cleaned up its balance sheet, reduced debt, and stopped chasing overseas mining fantasies
(Indonesia taught them a ₹53 Cr lesson). Now, instead of empire-building abroad, they are doubling down in Odisha — land, power, furnaces, and now even Tata Steel’s discarded assets.
But remember: this is still a cyclical metal business. IMFA doesn’t control prices. It only controls costs and survival. And so far, it has survived very well.
Before we get carried away, ask yourself: are you comfortable owning a stock whose earnings can halve just because China sneezed? If yes, keep reading.
3. Business Model – WTF Do They Even Do?
IMFA produces ferrochrome, an alloy of iron and chromium. Its primary use? Stainless steel. No stainless steel, no ferrochrome. Simple. Brutal. Cyclical.
The company operates two manufacturing units in Therubali and Choudwar (Odisha), strategically located near chrome ore and coal sources. This is not accidental. Freight costs in metals can eat profits faster than depreciation. IMFA said “no thanks” and built everything close by.
The secret sauce:
- Captive chrome ore mines → Lower raw material volatility
- Captive power (204.55 MW) → Energy cost control
- Large smelting capacity (190 MVA) → Scale advantage
- Exports (96%) → Dollar revenues, global pricing
IMFA also has a JV with POSCO, operating a 30 MVA furnace, producing 35,000 TPA, with a 25-year offtake commitment. This is like having a long-term tenant in a volatile market. Quarterly pricing still fluctuates, but volumes are locked.
Mining-wise, IMFA has 21 million tonnes of chrome ore reserves, with leases running till 2049/2055. They plan to ramp up captive ore production to 1.2 MnT by FY30, which should further protect margins.
So what does IMFA really sell?
It sells cost discipline in a chaotic commodity
