Established track record of operations and experienced management
Established in 1994, Anjani Steels Limited is helmed by Mr. Shiv Dhari Yadav and Mr. Girdhari Yadav, both possessing over two decades of experience in this field. Their extensive experience is evident in the strong relationships they have built with the company’s customers and suppliers. Since 1996-97, the company has been actively involved in the steel industry, with its current product line-up consisting of billets used in the production of long products, specifically TMT bars. These TMT bars serve the increasing demands of various sectors, including the power sector, infrastructure construction, steel and cement plant construction, as well as commercial and residential housing, among others. . The company has a locational advantage as the plants are located in the industrial area of Raigarh, Chhattisgarh, which is in close proximity to various steel plants and sources of raw materials. Further the plants are well connected through road and rail transport which facilitates easy transportation of raw materials and finished goods. Acuité believes that the experienced management with established presence of its operations will continue to benefit the company over the medium term.

Stable Financial Risk profile:
The company’s financial risk profile remained stable, supported by a moderate net worth, comfortable gearing levels, and stable debt protection indicators. The total tangible net worth improved to Rs. 160.85 crore in FY25 from Rs. 151.09 crore in FY24, driven by healthy internal accruals. Concurrently, total borrowings declined to Rs. 127.41 crore in FY25 from Rs. 137.96 crore in FY24, resulting in an improvement in gearing to 0.79 times as on FY25, compared to 0.91 times as on FY24.Total borrowings of Rs. 127.41 crore as on FY25 mainly comprised short term borrowing (cash credit) of Rs. 108.20 crore, long-term debt of Rs. 6.58 crore, current portion of long-term debt (CPLTD) of Rs. 10.83 crore, and unsecured loans of Rs. 1.80 crore from promoters/directors. Debt protection metrics remained stable, with interest coverage ratio (ICR) at 2.39 times but low debt service coverage ratio (DSCR) and 1.12 times, respectively, in FY25. Further, Total Outside Liabilities to Tangible Net Worth (TOL/TNW) and Debt/EBITDA improved to 1.08 times and 3.51 times, respectively, in FY25, from 1.19 times and 3.61 times in FY24. Acuité believes that the company’s financial risk profile is expected to improve over the medium term, supported by steady accruals and the absence of any debt-funded capex plans.

Moderate Working capital Management
The company’s working capital management remained moderate, marked by Gross Current Assets (GCA) of 149 days in FY25, compared with 144 days in FY24, primarily due to higher inventory holding. Inventory days increased marginally to 136 days in FY25 from 130 days in FY24, reflecting the company’s inherent operating cycle, as it maintains a processing cycle of about 4.0–4.5 months from procurement of raw materials to production of finished goods, resulting in a relatively higher build-up of raw material inventory. Debtor days remained low at 6 days in FY25, unchanged from FY24, supported by the company’s cash-and-carry sales model. The creditor days stood at 14 days in FY25 against 13 days in FY24, reflecting the company’s policy of releasing payments only after raw materials are delivered to the factory, inspected, and approved. Acuité believes that the company’s working capital intensity is expected to remain at similar levels over the medium term, given the nature of operations and the prevailing business model.

Decline in Scale of Operation in FY 26 with improvement in Margin:
ASL’s revenue increased marginally to Rs.613.61 crore in FY25 from Rs.604.42 crore in FY24, driven by higher demand for TMT bars; however, turnover moderated to Rs.509 crore in FY26 (Estd) due to Revenue was impacted by a planned ~30-day shutdown of the captive power plant in November 2025 for major maintenance (capex of Rs.3 crore funded through internal accruals), resulting in an estimated revenue loss of Rs.55–60 crore, along with an extended monsoon that disrupted construction activity and led to lower product off-take, impacting revenues by an estimated Rs.15–20 crore. Additionally, lower average steel price realizations amid a broader market correction further affected FY26 sales, underscoring the company’s exposure to cyclical steel prices. Operating margin moderated marginally to 5.78% in FY25 from 6.16% in FY24 due to higher raw material and power costs, the latter affected by reduced power plant efficiency prior to maintenance. Post-maintenance, efficiency levels have improved, and operating margins are expected to stabilize in the 6.0%–7.0% range over the medium term, with profitability during FY26 supported by effective cost controls in contractual labour, procurement, and logistics, as reflected in 9MFY26 performance. PAT margin remained stable at 1.59% in FY25 (FY24: 1.46%) supported by lower finance costs and is expected to improve further over the medium term with the completion of loan repayments.

Highly competitive industry and inherent cyclical patterns in the steel sector
The steel rolling sector continues to lack organization and cohesion, which makes it more susceptible to intense competition. The company faces strong competitive forces from both organized and unorganized players, which can affect market share and pricing power. Compounding this challenge is the cyclicality inherent in the steel industry, where demand and supply fluctuations lead to periods of both oversupply and shortages. Additionally, government focus on steel-intensive sectors like railways and infrastructure increases the sector's vulnerability. A prolonged drop in demand or delays in government-led infrastructure projects would negatively affect the financial performance of steel companies.