­Established track record along with experienced management 
HS is engaged into the trading and distribution of iron and steel products since 2017. The firm is managed by the partners Mr. Bharat J. Bhuta and Mr. Bhavin B. Bhuta who possess nearly five decades and two decades of experience in the iron and steel trading industry. The partners are being supported by its team of experienced professionals in managing day to day operations of HS. The extensive experience of the partners has enabled HS to establish a healthy relationship with its customers and suppliers. 

Efficient working capital operations 
The firm has an efficient working capital operation along with moderate reliance on working capital limits. The GCA days stood at 66 days in FY2025 against 57 days  in FY2024. The inventory days stood at 43 days in FY2025 against 41 days in FY2024. The debtor days stood at 15 days in FY2025 against 11 days in FY2024. The firm typically receives payments from its customers within 30 days. The creditor days stood at 1 days in FY2025 and FY2024. The utilization of the working capital limits stood moderate at ~45.83% in the last 6 months ending December 2025.

Declining revenue and thin margins
The revenue of the firm is declining Y-o-Y from the past three fiscal years and stood at Rs.629.10 Cr. in FY2025 against Rs.737.61 Cr. in FY2024. The decline in the revenue is primarily attributable to decline in the sales volume along with price realisations during the year. The 9MFY2026 revenue stood at ~Rs.575 Cr. The operating profit margin of the company stood at 2.21 percent in FY2025 against 2.44 percent in FY2024. The PAT margin stood at 0.98 percent in FY2025 against 1.20 percent in FY2024. The profitability margins of the firm are thin as it is into trading segment.

Moderate financial risk profile
The firm has a moderate financial risk profile marked by moderate net worth, debt protection metrics and high gearing. The tangible net worth stood at Rs.31.59 Cr. as on March 31, 2025, as compared against Rs.30.42 Cr. as on March 31, 2024. The gearing level stood high at 2.53 times as on 31 March 2025 as against 2.66 times as on 31 March 2024. The debt coverage indicators are moderate with interest coverage ratio at 3.10 times in FY2025 against 3.99 times in FY2024 and debt service coverage ratio at 2.38 times in FY2025 against 2.94 times in FY2024. The total outside liabilities to tangible net worth (TOL/TNW) stood at 2.66 times as of March 31, 2025.

Cyclical and competitive nature of steel industry
The steel long products industry is intensely competitive, with many organized and unorganized players especially in the secondary/steel re-rolling business, which is less capital intensive. HS operates in a highly competitive steel industry thereby putting pressure on pricing power. In addition, the industry is reeling under the pressure of cheaper imports. The performance is linked to the steel industry which is cyclical in nature as well as end user industries such as real estate, infrastructure and construction. However, this risk is mitigated as the infrastructure industry in booming and the demand is much on a higher side backed by government initiatives for the upcoming years.