SG Mart reported a challenging Q3 FY26 with a reported EBITDA of ₹17 crores, impacted by a ₹20 crore inventory loss from declining steel prices. However, the underlying business EBITDA was ₹40 crores, with sales volume growing 9% QoQ. Management expressed confidence in achieving ₹60 crores business EBITDA in Q4 FY26 and outlined an aggressive FY27 target of ₹350 crores+ EBITDA, driven by service center expansion and growth in high-margin renewable and new structure businesses.
vs Q4 FY26
| Metric | Value | YoY |
|---|---|---|
| Reported EBITDA | ₹17 Cr | — |
| Business EBITDA | ₹40 Cr | — |
| Sales Volume Growth | 0.09 qoq_growth | — |
| Working Capital Days | 27 days | — |
| Cash on Books | ₹787 Cr | — |
| Interest Cost | ₹17 Cr | — |
Segment Breakdown
Share of Volume
| Metric | Latest | Trend |
|---|---|---|
| Revenue(crores) | 1800 | |
| EBITDA Margin | 3% | |
| EBITDA(crores) | 137 | |
| Net Profit(crores) | 103 | |
| Working Capital Days(days) | 20 | |
| Business EBITDA(crores) | 50 |
| Category | Headline | |
|---|---|---|
Capex | Capex disclosed | |
Debt | Gross ₹134 crores | |
Liquidity | Cash ₹787 crores Cash on books generates quarterly interest income of ₹15-17 crores. |
| Category | Target | Priority |
|---|---|---|
| Profitability | Business EBITDA→₹60 crores | High |
| Profitability | Full Year EBITDA→₹140 crores | High |
| Profitability | Full Year EBITDA→₹350 crores+ | High |
| Profitability | Quarterly EBITDA Run Rate→₹80-85 crores | High |
| Profitability | Full Year PAT→₹250 crores | Medium |
| Profitability | Service Centre EBITDA Spread→₹2,000 per ton | High |
| Profitability | Renewable Structures EBITDA Spread→₹4,000 per ton | High |
| Profitability | New Structures (Trade Route) EBITDA→₹6,000-7,000 per ton | High |
| Profitability | Service Centre EBITDA (India)→₹150 crores | High |
| Profitability | Dubai Service Centre EBITDA→₹50 crores | High |
| Profitability | Total Service Centre EBITDA→₹200 crores | High |
| Profitability | B2B Metal Trading EBITDA Spread→₹800-900 per ton | High |
| Profitability | B2B Metal Trading EBITDA→₹50 crores | High |
| Profitability | Structures EBITDA→₹120-150 crores | High |
| Volume | Service Centre Volume→160,000 tons | High |
| Volume | Renewable Structures Volume→25,000 tons | High |
| Volume | New Structures (Trade Route) Volume→10,000 tons | High |
| Volume | Full Year Service Centre Volume (India)→750,000 tons | High |
| Volume | B2B Metal Trading Volume→500,000 tons | Medium |
| Volume | Solar Structures Volume→180,000 tons | High |
| Volume | Other Structures Volume (Trade Segment)→200,000 tons | High |
| Capacity | Annual Capacity for Solar Structures→250,000 tons | High |
| Capacity | Annual Capacity for Other Structures→250,000 tons | High |
| Working Capital | Working Capital Days→Better than 27 days | High |
| Growth | Earnings CAGR→50% | High |
| Service Centre Expansion | Operational Service Centres→20 (India) + 1 (Dubai) | High |
| # | Metric | |
|---|---|---|
| 01 | Q4 FY26 Business EBITDA achievement | |
| 02 | Jaipur Service Center operational status | |
| 03 | Renewable Structures volume growth | |
| 04 | New Structures (Trade Route) volume contribution | |
| 05 | Working Capital Days improvement |
| Severity | Risk |
|---|---|
medium | Steel price correction/volatility Inventory loss of ₹20 crores in Q3 due to sharp correction in steel prices; management aims to mitigate by keeping minimum inventory levels. Management |
low | Softness in demand Softness in demand in Q3 led to offering discounts to customers, impacting EBITDA spreads. Management |
low | Geopolitical environment Geopolitical events could lead to rising commodity prices, but management believes a larger absolute EBITDA will absorb such impacts. Management |
low | Delay in Service Center operations Jaipur Service Center operations delayed by a couple of months due to excessive rains, now expected by mid-March. Management |
SG Mart reported a Q3 FY26 EBITDA of ₹17 crores, which was below expectations. This was primarily due to an inventory loss of ₹20 crores caused by a sharp correction in steel prices of ₹2,500-3,000 per ton. Despite this, the underlying business EBITDA stood at ₹40 crores, and sales volume increased by 9% quarter-on-quarter, indicating a ramp-up in both B2B Metal Trading and renewable structure businesses.
Management is confident in achieving a business EBITDA of ₹60 crores in Q4 FY26. This is expected to be driven by improved EBITDA spreads in Service Centre business (₹2,000 per ton) and B2B Metal Trading (₹900-1,000 per ton). Renewable Structures volume is projected to increase to 25,000 tons (from 17,000 tons in Q3) with an EBITDA spread of ₹4,000 per ton. Additionally, new structures for residential rooftop, cable trays, and purlins are expected to contribute 10,000 tons of volume with high EBITDA of ₹6,000-7,000 per ton in Q4.
SG Mart targets a full-year EBITDA of ₹350 crores+ for FY27, with a quarterly run rate of ₹80-85 crores. This growth will be fueled by the expansion of service centers, with 5 new centers becoming operational in H1 FY27, contributing to a total of 750,000 tons volume and ₹150 crores EBITDA from India. The Dubai service center is expected to contribute ₹50 crores EBITDA. B2B Metal Trading is projected to yield ₹50 crores EBITDA from 500,000 tons volume. Renewable and other structures are targeted to contribute ₹120-150 crores EBITDA from 350,000-400,000 tons volume.
The company's short-term borrowings have significantly reduced from ₹700 crores in FY25 to ₹130 crores by December 2025, with gross debt on books at ₹134 crores. Interest cost for Q3 FY26 was ₹17 crores, with 50% attributed to bill discounting and 40% to steel imports. SG Mart maintains a healthy cash balance of ₹787-790 crores, which generates ₹15-17 crores in quarterly interest income. This liquidity is being utilized for CAPEX, including land acquisition and machinery for new service centers.
SG Mart plans to have 20 service centers in India and 1 in Dubai by end of FY28/early FY29. Five new service centers (Punjab, Jaipur, Kolkata, Indore, Ahmedabad) will start contributing from H1 FY27. The company is also diversifying its product offerings beyond HR coils to include cut-to-length metal sheets, embossed specialized checkered sheets, and new structures like residential rooftop, cable trays, slotted angles, and purlins, leveraging its distribution network and APL Apollo brand for strong margins.
Management acknowledges the risk of steel price volatility, which caused a ₹20 crore inventory loss in Q3. Their strategy to mitigate this is to maintain minimum inventory levels and avoid speculating on price movements. They believe that as the absolute EBITDA grows (targeting ₹350 crores+ in FY27), the impact of steel price fluctuations on the P&L will diminish. The company also noted that the Indian government's anti-dumping duties on steel have reduced reliance on imports for India, with Dubai operations being the primary importer.