📌 At a glance:
Satia Industries posted ₹3,967 Mn revenue in Q4FY25 (up 6% QoQ, down 8% YoY) with net profit for FY25 down 44% to ₹1,186 Mn. EPS crashed to ₹11.86 from ₹21.12 last year. CMP is ₹80 — tempting? Only if pricing pressure from ASEAN imports doesn’t turn into a full-blown flood.
🏢 About Satia Industries Ltd.
| Detail | Info |
|---|---|
| Listed On | BSE: 539201, NSE: SATIA |
| Headquarters | Sri Muktsar Sahib, Punjab |
| Incorporated | 1980 |
| Core Biz | Wood & Agro-based paper (writing, printing, specialty) |
| Installed Capacity | 2,00,000+ MTPA |
| ESG Friendly? | ✅ ISO 9001, 14001, 45001 certified + rice straw boiler |
| Distribution | 100+ dealers, offices in Delhi, Jaipur, Chandigarh |
Satia has long been India’s underdog paper king — but lately, margins are turning into tissue paper.
📊 FY25 Financial Summary
| Metric | FY25 | FY24 | Change |
|---|---|---|---|
| Revenue (INR Mn) | ₹15,120 | ₹17,208 | 🔻 -12% |
| EBITDA (INR Mn) | ₹2,703 | ₹4,187 | 🔻 -35% |
| EBITDA Margin (%) | 17.9% | 24.3% | 🔻 -646 bps |
| Net Profit (INR Mn) | ₹1,186 | ₹2,112 | 🔻 -44% |
| EPS (₹) | ₹11.86 | ₹21.12 | 🔻 -44% |
So we’re down across the board — revenue, margins, net profit, and investor patience.
📆 Q4FY25 vs Q4FY24 & Q3FY25
| Metric | Q4FY25 | Q3FY25 | Q4FY24 | YoY | QoQ |
|---|---|---|---|---|---|
| Revenue (₹ Mn) | 3,967 | 3,758 | 4,306 | 🔻 -8% | 🔼 +6% |
| EBITDA (₹ Mn) | 615 | 530 | 907 | 🔻 -32% | 🔼 +16% |
| Net Profit (₹ Mn) | 354 | 198 | 394 | 🔻 -10% | 🔼 +79% |
| EPS (₹) | 3.54 | 1.98 | 3.94 | 🔻 -10% | 🔼 +79% |
| EBITDA Margin (%) | 15.5% | 14.1% | 21.1% | 🔻 | 🔼 |
Yes, QoQ looks better — but don’t celebrate yet. The YoY decline shows that the industry storm isn’t over.
🧠 EduInvesting Take
Imagine you sell a ₹10 notebook for ₹12. Now ASEAN imports the same thing and sells it at ₹9.
That’s what happened to Satia. Prices crashed. Margins bled. And the FY25 results are paper-thin compared to FY24.
But… Satia didn’t collapse — thanks to:
- A loyal institutional base
- Fully integrated cost structure (read: rice straw boiler supremacy 🌾🔥)
- Long-term order book
It’s a war of attrition. And Satia is not losing, just limping.
🔮 Revised Forward-Looking Fair Value (FV)
Using EPS of ₹11.86, CMP = ₹80:
| Parameter | Value |
|---|---|
| FY25 EPS | ₹11.86 |
| Assigned P/E (Paper avg) | 8x |
| 🎯 Forward Value (FV) | ₹94.88 |
| 🟢 CMP | ₹80 |
| 🚀 Upside Potential | ~18.6% |
But for a proper re-rating, FY26 margins must bounce back.
🔎 Key Drivers Going Forward
✅ Rice Straw Boiler: Helping cut fuel costs
✅ PM3 Expansion: Will boost capacity and margin potential in FY27
✅ Low Debt: More room to absorb margin shocks
✅ One-Month Order Book: Visibility = Stability
But…
❌ ASEAN imports remain the biggest threat
❌ Pricing wars may prevent any margin recovery in FY26
❌ Digital substitution continues (seriously, when did you last write on paper?)
📊 Gross Margin Compression
| Metric | Q4FY25 | Q4FY24 | Change |
|---|---|---|---|
| Gross Margin (%) | 51.4% | 56.0% | 🔻 -460 bps |
⚠️ This erosion shows how quickly profits can vanish if pricing isn’t in your control.
🗨️ Management Speak
Chirag Satia, ED:
“We maintained volumes despite import pressure. FY26 is for stabilization, and FY27 is where we see true growth kicking in.”
Translation:
“FY25 was crap. FY26 is a nap. FY27? That’s when we snap back.”
⚠️ Risks
- ASEAN imports may continue unchecked unless govt imposes duties
- Earnings downgrade possible if realization drops further
- Delayed capacity ramp-up from PM3 or execution misses
- Paper demand shifting digital (schools going digital, government pushing e-docs)
📈 Final Verdict
| Parameter | Verdict |
|---|---|
| CMP | ₹80 |
| EPS (TTM) | ₹11.86 |
| Valuation | Cheap — if margins return |
| Business Outlook | Mixed — good infra, weak demand |
| Long-Term Strategy | Good, but execution-dependent |
| FY27 Hype Meter | 🔥🔥🔥 |
For now, Satia is a value pick with patience required — not a breakout rocket.
🗓️ Published: May 26, 2025
✍️ By: Prashant Marathe
Tags: Satia Industries, paper sector India, Q4 FY25 results, EPS crash, CMP 80, ASEAN paper imports, PM3 expansion, agro-based paper stocks, Punjab industries
