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Check Before You Invest : Maharashtra Seamless Ltd

BSE: 500265 NSE: MAHSEAMLES ISIN: INE271B01025
  |   Sector:  Metals & Mining   |   Industry:  Steel & Iron Products

Snapshot

Q.1 Which industry/sub-sector does Maharashtra Seamless Ltd belong to?
Maharashtra Seamless Ltd belongs to the Metals & Mining sector, operating specifically within the Steel & Iron Products segment.
Q.2 Is Maharashtra Seamless Ltd a good quality company?
Maharashtra Seamless Ltd is a average quality company, based on a somewhat consistent multi-year financial track record.

This assessment is based on company’s performance on Revenue growth, ROCE, Equity and Assets, key margin ratios, cash conversion cycle, and debt to cash flow from operations and how it compares with its long term averages.

Q.3 Is Maharashtra Seamless Ltd undervalued or overvalued?
Maharashtra Seamless Ltd appears Overvalued, as its key valuation ratios are higher than their past averages.

Based on the industry it operates in, the relevant valuation ratios include one of the following, P/E, P/BV, P/Sales, EV/EBITDA or a combination of two or more.

Valuation Ratios Current 5-year
Historic Median
Price to Earnings 10.23 11.34
Price to Book 1.29 1.35
Price to Sales 1.82 1.45
EV to EBITDA 7.22 7.21
Q.4 Is Maharashtra Seamless Ltd a good buy now?
Maharashtra Seamless Ltd is a good buy now, based on strong price trend analysis suggesting prices may rise. However, you need to check its quality and valuation before making a decision

Performance Analysis

We have analysed the performance of the company on the following:

  • How has it performed on generating Profits?

    By checking its Revenue growth, Gross, Operating and Net Margins compared to its last 5-year median.

  • How efficiently has it utilized Capital?

    By checking its ROCE, ROA, ROE and its Cash Conversion Cycle.

  • How is it managing its Debt?

    By checking its Debt to Equity and Cash Flow from Operations.

A: What are the trends in revenue and profit margins?

Q.1 Revenue growth of Maharashtra Seamless Ltd?
Maharashtra Seamless Ltd revenue growth is -2.5% for FY-2025, which is below its 5-year CAGR of 15.01%, indicating slower growth.

Q.2 Gross Profit margin of Maharashtra Seamless Ltd?
Maharashtra Seamless Ltd Gross profit margin which is the profit after deduction of direct costs, is 21.2% for FY-2025, which is in line with its 5-year median of 21.2%, indicating stable margins.

Q.3 Operating Profit Margin of Maharashtra Seamless Ltd?
Maharashtra Seamless Ltd Operating Profit Margin which is the profit after deduction of all operating costs, is 17.53% for FY-2025, which is below its 5-year median of 18.5% indicating decreasing margins.

Q.4 Net Profit Margin of Maharashtra Seamless Ltd?
Maharashtra Seamless Ltd Net Profit Margin is 15.06% for FY-2025, is in line with its 5-year median of 15.06%, indicating stable margins.
Current Level 5-year
Historic Median
Gross Profit Margin (%) 21.2 21.2
Operating Profit Margin (%) 17.53 18.5
Net Profit Margin (%) 15.06 15.06

B: Does the business utilize capital efficiently?

Q.5 Return on Asset of Maharashtra Seamless Ltd?
Maharashtra Seamless Ltd Return on Asset is 11.82%, which is below its 5-year historical median of 13.67%, indicating deteriorated asset utilization efficiency.

Q.6 Return on capital employed (ROCE) of Maharashtra Seamless Ltd?
Maharashtra Seamless Ltd Return on capital employed is 17.15% for FY-2025, which is in line with its 5-year historical median of 17.15%. The current ROCE is above its estimated weighted average cost of capital (WACC) of 13.5%, indicating value creation.

Q.7 Return on Equity (ROE) of Maharashtra Seamless Ltd?
Maharashtra Seamless Ltd Return on equity is 13.35% for FY-2025, which is below its 5-year historical median of 18.33%, indicating the business is making worse use of its shareholders capital.

Q.8 Cash conversion cycle of Maharashtra Seamless Ltd?
Maharashtra Seamless Ltd Cash conversion cycle is 123 days, above its 5-year historical median of 103 days, indicating deteriorated working capital management. However, you need to compare this with its peers in the industry.
Current Level 5-year
Historic Median
Asset Turnover (x) 0.78 0.78
ROE (%) 13.35 18.33
ROCE (%) 17.15 17.15
Cash Conversion Cycle 123 days 103 days

C: How much debt does the business have and is it at a sustainable level?

Q.9 Debt to Equity ratio of Maharashtra Seamless Ltd?
Maharashtra Seamless Ltd Debt-to-Equity ratio is 0.00, which is lower the industry average of 0.31, indicating lower debt levels in the industry.

Q.10 Debt to cash flow from operations of Maharashtra Seamless Ltd?
Maharashtra Seamless Ltd Debt to cash flow from operations is 0, which is at a healthy level.

Ownership & governance

D: Promoter shareholding and pledge status of Maharashtra Seamless Ltd?

Q.1 Promoter shareholding and pledge status of Maharashtra Seamless Ltd?
Promoters hold 70.28% of the Maharashtra Seamless Ltd, with 0.00% of their stake pledged, indicating no pledge risk.

Peer comparison (industry-wise, mcap)

E: How does Maharashtra Seamless Ltd performance compare with that of its Peers?

Q.1 Revenue growth of Maharashtra Seamless Ltd vs industry peers?
Maharashtra Seamless Ltd revenue CAGR is 15.01%, compared to the industry median CAGR of 7.56%, indicating faster growth and gaining its market share.
Profit Metrics
Current Level 5-year
Industry Median
Revenue Growth (%) -2.5 7.6
Gross Profit Growth (%) -17.6 19.2
Operating Profit Growth (%) -24.6 13.8
Net Profit Growth (%) -18.7 24.6
Operating Efficiency
Current Level 5-year
Industry Median
Asset Turnover (x) 0.78 1.27
ROE (%) 13.35 8.04
ROCE (%) 17.15 11.28
Cash Conversion Cycle (days) 123.31 72

Valuation & price assessment

Q.1 Stock return of Maharashtra Seamless Ltd over the last decade?
Over the last 9 year(s), the stock has delivered a CAGR of 20.3% based on the current price.
9Y 5Y 3Y 1Y
Share Price
CAGR
20.3% 34.1% 16.7% 2.8%
Q.2 Valuation ratios of Maharashtra Seamless Ltd vs historical?
The current P/E ratio of 10.23 is lower than its historical median of 11.34, indicating that the stock is trading below its historical average valuation.
Q.3 How do the current valuation ratios compare with 5-year historical median and industry numbers?
Valuation Ratios Current 5-year
Historic Median
5-year
Industry Median
Price to Earnings 10.23 11.34 17.36
Price to Book 1.29 1.35 1.63
Price to Sales 1.82 1.45 0.74
EV to EBITDA 7.22 7.21 10.05

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