1. At a Glance
Indsil Hydro Power & Manganese Ltd posted Q1 FY26 sales ₹40.1 Cr (+15% YoY) and PAT ₹6.1 Cr (after last quarter’s red ink). Margins bounced back to 15.7%, but the company’s history of defaults, plant closures, and random profitability makes this stock as predictable as Indian monsoons.
2. Introduction
Think of Indsil as that student who tops the class one year and barely passes the next. After years of debt restructuring, closures, and lawsuits, the latest quarter finally shows life. With a ROE of 55% (driven by a low equity base) and stock trading at 0.9x book, value hunters are sniffing around. But is this just a dead cat bounce?
3. Business Model (WTF Do They Even Do?)
Indsil manufactures low/medium/high carbon silico manganese—the vitamin pills for steelmaking. Its power division (hydro) helps reduce energy costs. But with Unit 2 shut and frequent operational hiccups, output swings wildly.
4. Financials Overview
Q1 FY26 Numbers:
- Revenue: ₹40.1 Cr (+15%)
- Operating Profit: ₹6.3 Cr (OPM 15.7%)
- PAT: ₹6.1 Cr (vs. -₹25 Cr loss in Q4 FY25)
- EPS: ₹2.19
Verdict: From ICU to jogging, but still needs therapy.
5. Valuation – What’s This Stock Worth?
No P/E due to volatile earnings, but P/B 0.89 implies market doesn’t trust the reported profits. With FY26E EPS ~₹5, fair value range lies at ₹50–₹70. Investors here need iron (and manganese) nerves.
6. What-If Scenarios
- If plant closures stop: Revenue stabilizes, EPS shoots to double digits.
- If defaults continue: Stock tanks to ₹30.
- If ferro alloy prices spike: ROCE > 40% stays, stock re-rates fast.
- If lawsuits bite: Cash flows go poof.
7. What’s Cooking (SWOT)
Strengths: High-margin ferro alloys, debt reduction, cheap valuation.
Weaknesses: Default history, operational shutdowns.
Opportunities: Steel demand growth, export markets.
Threats: Price volatility, legal risks, regulatory scrutiny.
8. Balance Sheet 💰
| ₹ Cr | FY23 | FY24 | FY25 |
|---|---|---|---|
| Equity | 28 | 28 | 28 |
| Reserves | 94 | 84 | 157 |
| Borrowings | 120 | 110 | 0 |
| Liabilities | 29 | 23 | 39 |
| Total Assets | 271 | 245 | 223 |
Zero borrowings now—finally debt-free after years of financial CPR.
9. Cash Flow (FY23–FY25)
| ₹ Cr | FY23 | FY24 | FY25 |
|---|---|---|---|
| Operating | 17 | 8 | -11 |
| Investing | 0 | 14 | 131 |
| Financing | -19 | -1 | -53 |
| Net Cash | -2 | 21 | 67 |
Positive cash flow in FY25, but sustainability is questionable.
10. Ratios – Sexy or Stressy?
| Metric | FY23 | FY24 | FY25 |
|---|---|---|---|
| ROE (%) | 6 | 1 | 55 |
| ROCE (%) | 6 | 1 | 50 |
| OPM (%) | 10 | -1 | -5 |
| D/E | 0.4 | 0.4 | 0.0 |
ROE looks sexy, but mostly accounting-driven.
11. P&L Breakdown
| ₹ Cr | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | 177 | 117 | 128 |
| EBITDA | 17 | -2 | -7 |
| PAT | -5 | -9 | 76 |
FY25 profit spike was a one-off (sale gains), not business strength.
12. Peer Comparison
| Company | P/E | ROE% | OPM% | PAT Qtr Cr |
|---|---|---|---|---|
| Indsil Hydro | — | 54.8 | 15.7 | 6.1 |
| Maithan Alloys | 5.1 | 18.3 | 9.8 | -58.1 |
| Owais Metals | 18.2 | 55.3 | 30.9 | 22.3 |
| Jainam Ferro | 26.7 | 9.0 | 6.7 | 2.3 |
Indsil’s ROE is eye-popping, but peers have more consistent growth.
13. EduInvesting Verdict™
Indsil Hydro is like a comeback story still missing its final act. With no debt, margins recovering, and cheap P/B, it’s tempting. But operational unpredictability and past defaults make this a high-risk, high-reward alloy play.
If you like thrillers, you’ll like this stock. If not, stick to safer metals.
Written by EduInvesting Team | 28 July 2025
Tags: Indsil Hydro Power & Manganese, Q1 FY26, Ferro Alloys, EduInvesting Premium
