Steel stock in focus after signing MoU with Tata Steel; Acquires 50% stake in Nexus Holdco FZCO

Synopsis:- Shares moved after a non-binding MoU with Tata Steel for greenfield steel projects and mining collaboration. Revenue jumped 154% YoY to ₹3,651 crore, while profit rose to ₹567 crore. A $55-million stake acquisition and rising value-added mix signal expansion and strengthening margins.

The shares of the sponge iron manufacturer gained up to 1.3 percent from the intraday low after the company entered into a non-binding Memorandum of Understanding (“MOU”) with Tata Steel Limited.

With a market capitalisation of Rs 66,594.97 crore, the shares of Lloyds Metals and Energy Ltd were trading at Rs 1,260.30 per share, decreasing around 1.83 percent as compared to the previous closing price of Rs 1,281.60 apiece.

MoU with Tata Steel

According to the company filing, Lloyds Metals and Energy and Tata Steel have signed a non-binding MoU to explore strategic collaboration in Maharashtra’s Gadchiroli district. The partnership aims to jointly operate mining concessions, boost iron ore production, and assess Tata Steel’s participation in Lloyds’ integrated steel projects. This potential alliance could strengthen supply chains, expand capacity, and accelerate development of the emerging regional steel hub.

Further, the proposed partnership explores broad collaboration across greenfield steelmaking, iron ore mining, slurry pipelines, pelletisation, and DRI production, while also targeting exports of low-carbon value-added steel. By combining Tata Steel’s scale with Lloyds Metals’ resource strength, the MoU aims to drive sustainable, efficient growth and unlock new opportunities in India’s iron-ore-rich regions.

Additionally, the subsidiary Lloyds Global Resources FZCO entered into an arrangement to acquire a 50% stake in Nexus Holdco FZCO for up to $55 million. This move deepens the company’s presence in mineral exploration and processing, enabling expansion into a fast-growing commodity segment. The investment strengthens portfolio diversification and supports long-term growth in global resource markets.

Q2FY26 Highlights

Recently, the company announced its mixed financial performance in Q2FY26, in which revenue increased by 154 percent on a year-on-year basis from Rs 1,436 crore in Q2FY25 to Rs 3,651 crore in Q2FY26. However, on a Quarter-on-Quarter basis, revenue increased by 53 percent from Rs 2,384 crore in Q1FY26 to Rs 3,651 crore in Q2FY26.

Moreover, net profit increased by 88 percent on a yearly basis from Rs 301 crore in Q2FY25 to Rs 567 crore in Q2FY26, meanwhile, on a quarter-on-quarter basis, net profit plummeted by 12 percent from Rs 642 crore in Q1FY26 to Rs 567 crore in Q2FY26.

Additionally, Earnings before interest, tax, depreciation and amortisation (EBITDA) surged 153.5% to  Rs 1,042.9 crore from  Rs 411.4 crore in the same quarter last year. Meanwhile, EBITDA margin remains flat at 29%.

Lloyds Metals’ revenue mix is shifting strongly toward value-added products. VAP contribution rose to 47% in Q2FY26, up from 26% in Q2FY25 and 13% in Q1FY26, indicating rapid scaling. This shift supports stronger margins and reduces dependence on pure iron ore sales.

Lloyds Metals is progressing on major capacity expansions aimed at boosting value-added output. Iron ore capacity remains 26 MNT, while BHQ beneficiation will scale to 45 MNT. Pellet capacity doubles from 4 MNT to 8 MNT, and DRI stands at 0.70 MNT. The 85 km slurry pipeline supports integration, with steel (WRM) adding 1.2 MNT post-expansion.

Lloyds Metals and Energy Ltd is a growing integrated mining and metals company focused on iron ore, pellets, and DRI production. With expanding capacities, a strong value-added product mix, and efficient logistics like its slurry pipeline, the company is rapidly scaling to become a significant player in India’s steel value chain.

Written by Abhishek Singh

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