Sarda Energy Shares in Focus After Announcing Strong EBITDA Growth Guidance to Keep an Eye On

Synopsis: Sarda Energy & Minerals shares rose 4%  amid strong domestic steel demand and rising costs from geopolitical tensions. The company plans to double SKS power capacity, targeting Rs. 3,500–4,000 cr EBITDA in five years.

The shares of the company are integrated steel producer with captive iron ore and a manufacturer/exporter of niche manganese-based ferro alloys are in the spotlight after it rose 4% after announcing plans to double SKS power plant capacity.

With a market capitalisation of Rs. 19,195 cr, the shares of Sarda Energy & Minerals Ltd were trading at Rs. 544.75 per share, jumping 4% in today’s market session, up from its previous close of Rs. 523.70 per share. The stock has gained 17% over the past year, risen 7% year-to-date, declined 4% in the last six months, and increased 3% in the past month.

What’s the news

PK Jain, Group CFO of Sarda Energy & Minerals, highlighted that the ongoing US-Iran tensions have affected the company’s freight costs and logistics. He also highlighted strong domestic steel demand, with long product prices reaching around Rs. 5,000 per tonne in Q4. 

While Sarda Energy & Minerals does not export to Iran, the broader geopolitical situation has influenced operational costs and supply chain efficiency. Despite these challenges, Japan remains a key export market for the company.

Exports form a significant part of Sarda Energy & Minerals’ business model, contributing approximately 20% of the company’s total revenue. This demonstrates the company’s reliance on international markets while maintaining its primary focus on domestic operations. 

Expansion Plans

The company is planning to double the SKS power capacity, with additional production expected to come online in about five years. This expansion is a strategic move to increase production capability and meet rising demand.

Following the expansion and commissioning of additional capacity, the company anticipates its EBITDA to range between Rs. 3,500–4,000 crore, indicating a substantial boost in profitability once the new projects are operational.

About the company 

Sarda Energy & Minerals Ltd is the flagship firm of the Sarda Group, engaged in integrated steel production (including sponge iron, billets and wire rods), mining (iron ore, coal), and the manufacture and export of manganese‑based ferro alloys. The company also generates its own power through thermal and hydro plants and produces eco‑friendly bricks from waste by‑products.

It reported a year-on-year (YoY) decline in its Q3FY6. Revenue fell 3% to Rs. 1,276 crore from Rs. 1,319 crore in Q3FY25. EBITDA dropped 16% to Rs. 311 crore from Rs. 369 crore. Net profit decreased 5% to Rs. 190 crore from Rs. 200 crore, and EPS declined 4% to Rs. 5.40 from Rs. 5.60, reflecting pressure on margins and profitability.

As of Q3FY26, its total energy capacity is 928.3 MW, reflecting significant additions across thermal, hydro, and ongoing projects. Looking ahead, the expected future capacity is set to increase further to 1,053.3 MW, with the incorporation of planned hydro and solar projects. This growth underscores the company’s strategic expansion and diversification across thermal, hydro, solar, and coal mining operations, positioning it for stable, long-term value creation.

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