Shri Bajrang Alliance FY26: A ₹271 Crore Steel Roller That Books ₹44 Crore of Profit It Didn’t Quite Earn

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1. At a Glance

Shri Bajrang Alliance closed FY26 with revenue of ₹271 crore, down about 32% from ₹398 crore the year before. Operating profit sat at roughly ₹4 crore — an operating margin near 1%, where it has more or less lived for years. And yet the consolidated bottom line reads ₹44.27 crore, up from ₹32.6 crore, the best profit figure in the company’s recorded history.

Two numbers moving in opposite directions is the entire story here. A shrinking steel roller with a wafer-thin operating margin somehow reports its fattest-ever net profit. The reconciliation isn’t hidden — it sits in the consolidated accounts, where profit before tax was ₹3.81 crore and the share of profit from associate companies did the rest of the lifting.

Alongside the results came a clean-out: a Chairman resigned, a new Chairman & Managing Director was named, an independent director’s term ended, a partnership was exited, and the bank facility was downgraded a notch. A busy June for a quiet company.

The market, meanwhile, pays about 3.9x earnings for all of this — against a peer median north of 22x. That single gap is the question the rest of this entry circles.

2. Introduction

Incorporated in 1990 and run by the Goel family out of Raipur, Chhattisgarh, Shri Bajrang Alliance is described in its filings as one of the larger structural rolling mills in the state. The Goel group’s interests spread across steel, media, digital marketing, hydro power and food processing, and SBAL has operational linkages with the group’s flagship, Shri Bajrang Power & Ispat Ltd, for sourcing raw materials.

The company runs two divisions. The steel manufacturing unit — angles, beams, channels, flats, rounds — carried a rolling capacity that expanded from 60,000 MT to 100,000 MT over the recent period. The food division, incorporated in 2020, sells 100% vegetarian frozen products under the GOELD brand and has picked up approved-supplier arrangements with names including KFC, Domino’s and Nestlé India in earlier years.

FY26 was interrupted in a literal sense: plant operations were temporarily shut from 18 November 2025 to 6 February 2026 for capacity expansion and process improvement, per the credit rating rationale. That closure is visible in the December quarter, which we come to below.

The consolidation matters more than usual for this company, because SBAL holds an associate stake in the flagship steel entity, and that associate is where the reported profit largely originates.

3. Business Model: WTF Do They Even Do?

On paper, two things. They roll steel into structural shapes, and they freeze samosas. The revenue-weighted answer is steel — the manufacturing operations dominate the top line, with trading a small slice — while the food business supplies the growth narrative and the KFC-Domino’s-Nestlé name-drops.

But the profit model is a third thing entirely, and it’s the interesting one. SBAL’s own operations threw off roughly ₹4 crore of operating profit on ₹271 crore of sales in FY26. The reported ₹44 crore of net profit comes overwhelmingly from its share of an associate’s profit, sitting well below the operating line. So the honest description of the business model is: a low-margin steel roller and frozen-food maker that also happens to own a meaningful stake in a much more profitable steel company, and consolidates its share of that profit.

This is not a criticism — associate accounting is standard. It’s just worth being precise about which engine is pulling the train. When someone points at a ₹44 crore profit, the operating business contributed a rounding error of it; the associate contributed the bulk.

The frozen-food arm is the part management clearly wants investors to watch — supercritical oils, nutraceuticals, retail foods, an ESG deck, thirty-five cities of “GOELDEN presence.” It is also, so far, a small operation attached to a steel company whose margins the food business has not yet meaningfully changed.

Does a fast-food supplier list fix a 1% operating margin, or just make the deck look better?

4. Financials Overview

Figures are consolidated, in ₹ crore.

Revenue fell about 41% year-on-year, yet PAT rose 71% — the March quarter carried ₹4.13 crore of other income and, again, the associate profit share doing the heavy work below the operating line. The December quarter is the cleaner window into the actual business: an operating loss of ₹2.5 crore, coinciding with the plant closure for capacity expansion that ran through that period.

Management’s own presentation frames FY26 EBITDA (consolidated) at ₹49.99 crore against ₹37.55 crore in FY25, and reported consolidated PAT of ₹44.27 crore versus ₹32.6 crore — figures it attributes to operational stability and a shift toward higher-margin manufacturing.

5. Market Expectations & Historical Multiples

This section describes how the market is currently pricing the company and how that compares with its own history and peer group. It is descriptive, not predictive.

The market currently pays about 3.9x earnings here versus a peer median near 22.6x. It also pays 0.45x book — below the value of the company’s own equity as carried on the balance sheet.

What the market appears to be pricing in is the composition of that profit. The earnings the P/E divides into are dominated by associate income rather than the company’s own operations, whose ROCE sits at 1.1% against a peer median of 13.7%. A low multiple on profit that mostly originates outside the operating business is a different proposition from a low multiple on operating earnings, and the pricing seems to register that distinction.

One factual observation on expectations: the same profit that produces a 12.3% ROE produces a 1.1% ROCE — the market is looking at two very different numbers depending on where in the income statement it stops reading.

6. What’s Cooking

June 2026 was eventful. Narendra Goel resigned as Director and Chairman effective 8 June, citing other commitments. On 24 June the board designated Anand Goel as Chairman & Managing Director, took note of independent director Rakesh Kumar Mehra’s tenure ending, and reappointed Anshul Dave as an independent director for a second five-year term from August 2026. Mehra ceased as director on 29 June.

Also on the docket: SBAL exited its entire remaining 16% partnership interest in Shri Bajrang Chemical Distillery LLP, completed 26 June, a withdrawal the company said was intended to reduce long-term capital commitment and contingent exposure and redeploy resources toward its core steel and food operations.

And Infomerics downgraded the ₹25 crore bank facility to IVR BBB-/Stable on 23 June, citing sustained revenue decline over FY24-FY26 and a leveraged capital structure.

Four board changes, one exit, one downgrade — three weeks.

7. Balance Sheet

Assets equal liabilities in each column, as they should.

• Borrowings nearly doubled from ₹59 crore to ₹104 crore over two years, while revenue over the same stretch fell from ₹570 crore to ₹271 crore — debt up, sales down.
• Investments of ₹328.62 crore make up the largest single asset on the sheet — larger than net block, receivables and inventory combined. This is a steel roller whose biggest asset is a portfolio of holdings.
• Inventory climbed to ₹92.64 crore against ₹271 crore of sales, pushing inventory days higher even as the business shrank.

With cash of ₹0.32 crore against ₹104 crore of borrowings, there is no net-cash cushion here — the opposite. A balance sheet that grows its liabilities faster than its business is a balance sheet writing cheques its income statement isn’t cashing.

8. Cash Flow: Sab Number Game Hai

Here the associate profit does not help, because associate income is a book entry, not cash. Operating cash flow has been negative for two straight years — ₹-23.66 crore in FY25 and ₹-10.27 crore in FY26 — which the credit rationale ties to a build-up in inventories and other current assets. Financing activity plugged the gap in FY25 with ₹36.91 crore of inflows. A profit-and-loss statement can report a record; the cash flow statement is where you check whether anyone got paid.

9. Ratios: Sexy or Stressy?

ROCE of 1.1% says the operating business barely earns its keep on the capital deployed in it. ROE of 12.3% looks respectable only because associate profit enters after the operating line — the equity is being flattered by income the operations didn’t generate. PAT margin of 16.3% on a 1% operating margin is the same illusion in a different dress. D/E of 0.27 looks modest, though the credit report notes overall gearing rises sharply once a ₹353.37 crore corporate guarantee to a group entity is included. When ROE and ROCE point in opposite directions this violently, the gap between them is the analysis.

10. P&L Breakdown: Show Me the Money

The Other Income column and the PAT column tell the same lesson twice. In FY26, operating profit was ₹4 crore and other income ₹4.73 crore — together about ₹9 crore — yet PAT landed at ₹44.27 crore. The difference is the consolidated share of associate profit, which sits below both. Revenue has fallen for two consecutive years, from ₹570 crore to ₹271 crore, and the operating profit line has stayed flat and thin throughout. The headline profit rose anyway. Anchor the story on the ₹4 crore operating profit and the ₹271 crore revenue; the ₹44 crore is real accounting, but it is not the roller and the freezer earning it.

EPS rose to ₹49.19 in step with PAT, so no share-count distortion here — the count has held at 0.9 crore shares.

11. Peer Comparison

SBAL is a rounding error on the peer set’s revenue scale — ₹47 crore of quarterly sales against thousands of crore for the rest — and carries the lowest multiple in the group by a wide margin. It also carries the peculiarity none of the peers share: a quarterly PAT larger than 40% of quarterly revenue, on a 1% operating margin. The peers earn their profit in the operating line; here it arrives from elsewhere. The multiple gap and the profit-composition gap are the same fact viewed twice.

12. Miscellaneous: Shareholding & Promoters

The Goel family holds just under 64%, spread across a long roster of family members and HUFs, with holdings essentially unchanged over the year. Within the public block, Atlanta Securities Pvt Ltd holds 8.41%. The promoter group’s experience in steel runs over three decades, and the group’s flagship — the same associate whose profit dominates SBAL’s consolidated line — anchors the family’s presence in the sector. The promoter conduct note worth logging: this is a group that consolidates profit from itself into itself, entirely within the rules, and the reader is left to weigh how much of SBAL’s earnings is a bet on SBAL versus a bet on the associate next door.

13. Corporate Governance: Angels or Devils?

Statutory auditor SSSD & Co. issued an unmodified opinion on both standalone and consolidated FY26 results. The board reconstituted its audit and nomination committees effective June 2026, with independent directors chairing.

Two items belong on the record as facts. First, related-party density is high: the SBCD LLP exit was a transaction with the promoter group, and the company carries a ₹353.37 crore corporate guarantee to that same group entity, which the credit report flags as materially raising effective gearing. Second, the company has reported profits for years and paid zero dividend across the entire recorded history — a 0% payout ratio every single year on the sheet. None of this is a rule breach; all of it is worth a reader’s eyebrow.

14. Industry Roast & Macro Context

Steel rolling in Chhattisgarh is a crowded, cyclical, low-differentiation business — organised and unorganised players elbowing for the same structural-steel orders, with pricing power that evaporates the moment demand softens. The credit rationale names exactly this: limited pricing flexibility, exposure to commodity swings, and vulnerability to any downturn in the cycle. It’s an industry where a 1% operating margin isn’t an accident so much as a feature of standing in the middle of the pack. The frozen-food adjacency is the escape hatch every regional steel maker seems to want these days — higher margins, consumer branding, an ESG slide — though convenience food is its own knife fight of shelf space and cold-chain economics. Diversifying out of a commodity by entering a different commodity is a popular move; it is rarely a free one.

15. EduInvesting Verdict

The central tension is one number sitting on top of another that can’t support it: a ₹44 crore profit resting on a ₹4 crore operating base, with the difference imported from an associate. Everything the market finds cheap here and everything the credit agency finds risky here trace to that same gap.

A record profit the operations didn’t generate, and a multiple that has already noticed.