IMFA - Indian Metals

📊 NSE: IMFA 🏢 Mining / Minerals / Metals 📅 Last Updated: 12/14/2025 7:58

💰 Financial Performance

Revenue Growth by Segment

Earnings per share (EPS) grew 3.96% YoY from INR 67.41 to INR 70.08, while Net Worth increased 11.68% to INR 2,322.29 Cr. The primary segment is ferro chrome production, with captive power generation supporting operations.

Geographic Revenue Split

Exports contribute 91.35% of total turnover, primarily serving manufacturers of stainless steel in international markets like South Korea, China, and Taiwan.

Profitability Margins

Operating profit margin (before exceptional items) improved from 20.58% to 21.23% YoY. Net profit margin (after exceptional items) increased from 13% to 15% YoY, reflecting improved operational efficiency.

EBITDA Margin

Operating profit margin stood at 21.23% for FY 2024-25, up 3.16% from the previous year's 20.58%. Core profitability remains resilient due to the fully integrated business model.

Capital Expenditure

Historical gross block increased 5.56% to INR 1,993.78 Cr. Planned capex includes INR 1,750 Cr over seven years for a greenfield ferro chrome unit and mine expansions, with some documents citing a larger INR 2,200 Cr program over three years including asset acquisitions.

Credit Rating & Borrowing

ICRA maintains a strong rating with a positive outlook. Key upgrade trigger is Total Debt/OPBDITA of less than 1x on a sustained basis. Long-term borrowings are negligible at INR 0.21 Cr as of March 2025.

⚙️ Operational Drivers

Raw Materials

Chrome ore (captive) and Coal (external/grid) are the primary raw materials. Captive ore and power provide a significant cost advantage over non-integrated peers.

Import Sources

Chrome ore is sourced domestically from captive mines in Sukinda and Mahagiri, Odisha. Coal is sourced externally following the cancellation of the Utkal C block.

Key Suppliers

Jindal Steel & Power Limited (JSPL) acquired the Utkal C block previously held by IMFA. Tata Steel is a potential supplier/partner through asset acquisition discussions.

Capacity Expansion

Current power capacity is 204.5 MW. Planned expansion includes a 1 lakh TPA greenfield ferro chrome unit at Kalinganagar and doubling mine capacities (Sukinda to 6 lakh TPA; Mahagiri to 6 lakh TPA).

Raw Material Costs

Integrated operations with captive chrome ore and power translate to superior margins. Raw material costs are optimized through self-sufficiency in ore, though coal remains an external cost factor.

Manufacturing Efficiency

Fully integrated business model (ore to power to ferro chrome) ensures operational stability and high manufacturing efficiency compared to non-integrated competitors.

Logistics & Distribution

Manufacturing sites are located close to ports, which helps in controlling outward freight costs for the 91.35% export-oriented turnover.

📈 Strategic Growth

Growth Strategy

Growth will be driven by a greenfield ferro chrome unit (~1 lakh TPA), brownfield mine expansions to double output, and the acquisition of Tata Steel's ferro chrome assets.

Products & Services

The company primarily produces and sells ferro chrome, an essential input for stainless steel manufacturing.

Brand Portfolio

IMFA (Indian Metals & Ferro Alloys Limited).

New Products/Services

Setting up a 120 KLPD grain-based ethanol plant to diversify revenue streams beyond the cyclical ferro alloys industry.

Market Expansion

Targeting increased capacity at Kalinganagar and expanding underground mining operations at Sukinda and Mahagiri over the next 3-7 years.

Market Share & Ranking

IMFA is a leading integrated producer of ferro chrome in India and aims to extend its leadership position through upcoming capacity expansions.

Strategic Alliances

Maintains long-term relationships with marquee global customers like POSCO (South Korea), Tsingshan Group (China), and Marubeni Corporation (Japan).

🌍 External Factors

Industry Trends

The industry is cyclical. Future direction is focused on sustainability, with IMFA targeting a 5% increase in renewable energy use by March 2026.

Competitive Landscape

Competes with global ferro chrome producers; IMFA's integration provides a cost moat that non-integrated peers lack.

Competitive Moat

The moat is built on a fully integrated model (captive ore and power), making IMFA one of the lowest-cost producers globally. This advantage is highly sustainable due to long-term mining leases.

Macro Economic Sensitivity

Highly sensitive to global steel industry cycles and stainless steel demand, which directly dictates ferro chrome pricing and demand.

Consumer Behavior

Demand is driven by stainless steel manufacturers' requirements for high-quality ferro chrome with consistent specifications.

Geopolitical Risks

Trade barriers or economic changes in key export markets like China and South Korea could disrupt the 91.35% export revenue stream.

⚖️ Regulatory & Governance

Industry Regulations

Operations are subject to mining laws, environmental pollution norms, and safety standards (targeting LTIFR < 0.3).

Environmental Compliance

Committed to a 5% annual reduction in Scope 1, 2, and 3 emissions and a 5% increase in renewable energy energy mix by 2026.

Taxation Policy Impact

Exposed to potential changes in taxation of mineral rights following a Supreme Court ruling, which could impact mining costs.

Legal Contingencies

Recovered INR 374 Cr as compensation for the Utkal C coal block. Pending matters include the impact of the Supreme Court ruling on mineral rights taxation.

⚠️ Risk Analysis

Key Uncertainties

The inherent cyclicality of the ferro chrome industry results in volatile cash flows. Large-scale capex (INR 1,750 Cr+) poses execution and project commissioning risks.