Prakash Industries Ltd Q2FY26 – Steel Strong, Court Drama Stronger, and Coal Mines Finally Breathing Fire!

1. At a Glance

If Prakash Industries Ltd were a Bollywood movie, it would have everything — drama, suspense, legal twists, and a hero trying to rebuild reputation while juggling molten steel and hot coal. The company closed Q2FY26 withSales of ₹723 croreandPAT of ₹62 crore, a steep dip of-32.8% YoYin sales and-31.9% YoYin profit. But don’t be fooled — this iron man of Chhattisgarh is finally firing up its own coal mine after years of waiting, which could flip the narrative in FY26 like a plot twist in a Rajkumar Hirani film.

At₹133 per share, the stock sits 30% below its 52-week high, with a market cap of₹2,386 croreand aP/E ratio of 7.28— practically a discount sale on the steel street. TheROE and ROCEboth hover at11.2%, proving the company is decently efficient, whiledebt-to-equity is a chill 0.10, meaning Prakash isn’t living on borrowed gas.

The headline:Coal mines finally operational, CFO newly appointed, and profits cooling faster than a TMT bar in monsoon season.

2. Introduction

Prakash Industries has lived many lives — from being a rising steel producer to fighting court cases that could give “Suits” a spin-off idea. Founded decades ago and headquartered in Haryana, this is one of India’s moreold-schoolsteelmakers, the kind that believes in doing everything in-house — from mining iron ore to generating its own electricity. Think of it as the Indian version of “do-it-yourself capitalism.”

Q2FY26 might look like a dull quarter with falling sales, but hidden beneath those hot furnaces is something shiny — theBhaskarpara Coal Mine, now operational. This single mine has been the company’s dream project for years, and now, as dispatches begin, the cost structure could finally turn attractive enough to melt investor skepticism.

Yet, Prakash isn’t all sunshine and rolling steel coils. Its dependence on the top 10 customers for~71% of total incomeleaves it as concentrated as a college canteen’s coffee. Add in the legal roller coaster — ED attachments, High Court orders, and quashed decisions — and you have a company that’s basically a courtroom thriller in PPE gear.

Still, with 245 MW of captive power, 1.25 MnTPA of billet capacity, and now its own coal mine, Prakash seems ready to strike back. The question is — will investors have the patience to wait for the next act?

3. Business Model – WTF Do They Even Do?

Let’s simplify the chaos. Prakash Industries is basically asteel and power hybrid— a muscular machine that melts iron ore, adds some ferro alloys, spins out billets, and turns them into shiny wire rods, HB wires, and TMT bars that go into construction, automotive, and heavy industries.

Their steel is made the desi way — vertically integrated. Meaning, they mine their own ore (Odisha + Chhattisgarh), generate their own power (245 MW worth of muscle), and sell steel products across India. That’s right — this company doesn’t like middlemen. They’d rather burn their own coal than pay someone else.

They also own a6 MW windmill in Tamil Nadu— because apparently, even steel companies want to feel a bit green for CSR photos.

But the real “a-ha!” moment is theirBhaskarpara Coal Minein Chhattisgarh, which became operational early 2025. For years, Prakash had to buy coal from others, making costs unpredictable. Now, they’ll dig their own energy source. Imagine going from renting your gas cylinder to owning your own LPG company.

Of course, there’s also a risk. The company spent₹500 crore in capex, with ₹400 crore already sunk into developing the mine. So, while investors wait for payback, Prakash will have to prove that all this digging leads to profits — not a fiscal pothole.

4. Financials Overview

Commentary:If steel had a cooling period, Q2FY26 would be it. Revenue melted faster than butter on bhature, and profit shrank like a wool sweater in hot wash. With EPS at ₹3.44 this quarter, the annualized EPS comes to roughly ₹13.76 — giving aP/E of about 9.7(a bit above the reported 7.28 due to fluctuation in quarterly performance).

But hey, EBITDA margin held up decently at15%, so while volumes may have dipped, cost control hasn’t gone out of the furnace.

5. Valuation Discussion