Indian Metals (IMFA)
CyclicalFairStock Score: 54/100 — MIXED
Score breakdown: P/E: 2/3 · ROCE: 1/2 · Growth: 2/2 · Dividend: 0/1
Key Financials
| Current Price | ₹1,404.5 |
| Market Cap | ₹7,577.85 Cr |
| P/E Ratio | 14.45 |
| ROCE | 21.29% |
| ROE | 15.93% |
| Dividend Yield | 0.89% |
| Profit Growth | 108.5% |
| Debt/Equity | 0.35 |
| Sales Growth | 49.7% |
| Promoter Holding | 58.69% |
| 52-Week Range | ₹1,003.85 — ₹1,674.9 |
| Sector | Ferrous Metals |
| Book Value | ₹503.67 |
Strengths
- Strong balance sheet with Debt/Equity of 0.17
- High returns on capital: ROE 15.93%, ROCE 21.29%
- Profit growth of 40.69% on 9.27% sales growth indicates operating leverage
- Piotroski F-Score 7/9 reflects sound financial health
- Promoter holding of 58.69% aligns management with shareholders
Concerns
- Commodity business with likely cyclical earnings volatility
- Valuation appears rich: P/E 18.53 and P/B 3.67 near 52-week high
- High recent profitability may be cyclical peak, not sustainable normal earnings
- FairStock Score of 49/100 flags a mixed overall picture
AI Analysis
Applying the Graham-Buffett lens, I start with business quality, not the stock. IMFA makes ferro and silica manganese—useful inputs for steel, but essentially a commodity. No brand, no pricing power, and margins are dictated by metal price cycles. The numbers show why it looks tempting: 15.93% ROE, 21.29% ROCE, and negligible debt at 0.17 D/E. Promoters own 58.69%, so interests are aligned, and the Piotroski score of 7 out of 9 suggests the recent financial position is sound. Profit growth of 40.69% on only 9.27% sales growth is impressive, but it smells like operating leverage in an up-cycle, not durable compounding. In the latest quarter, sales of ₹703 Cr generated ₹131 Cr profit—that is roughly 18.6% net margin, far above what a commodity producer should assume as normal. Graham would demand a margin of safety. At ₹1,550, I am paying 18.53 times trailing earnings and 3.67 times book value of ₹422.87. That is rich for a cyclical near its 52-week high of ₹1,674.90, with a dividend yield of only 1.58%. The PEG of 0.74 assumes the recent 40% profit growth will continue, but commodity cycles rarely cooperate. I would call this a well-run cyclical, not a wonderful business at a fair price. The low debt, high promoter holding and good returns make it a company to respect, but valuation leaves little room for error. If I owned it, I would keep tracking metal prices, debt and consistency of cash flows rather than projecting the latest quarter into perpetuity.
Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer