JAINAM - Jainam Ferro

📊 NSE: JAINAM 🏢 Mining / Minerals / Metals 📅 Last Updated: 12/14/2025 8:33

💰 Financial Performance

Revenue Growth by Segment

The company operates in a single reportable segment (Ferro Alloys). Total revenue grew by 96.65% YoY in FY22, reaching INR 201.61 Cr compared to INR 102.52 Cr in FY21. For H1 FY23, revenue was INR 166.67 Cr, representing an 84.15% increase over H1 FY22 (INR 90.51 Cr).

Geographic Revenue Split

The company has a strong PAN India presence, catering to steel hubs in Gujarat, Maharashtra, Punjab, and Karnataka. It also exports to major European countries. Specific percentage splits per region are not disclosed, but management plans to expand into American and Middle East markets starting January 2023.

Profitability Margins

Gross Profit margin improved from 37.77% in FY20 to 44.03% in FY22. Net Profit Margin (PAT) saw a significant jump from 3.08% in FY21 to 13.90% in FY22. However, H1 FY26 consolidated results show a Net Profit before tax of INR 7.32 Cr on a total income of INR 166.67 Cr, indicating a margin compression compared to the high of FY22.

EBITDA Margin

EBITDA margin stood at 19.42% in FY22 (INR 39.15 Cr), a massive increase from 6.17% in FY21 (INR 6.33 Cr). This 213% YoY improvement in margin was driven by better capacity utilization and favorable pricing, though management expects margins to soften due to commodity price cooling.

Capital Expenditure

The company raised INR 25.415 Cr through the conversion of 11,50,000 warrants in April 2025. Of this, INR 15.415 Cr was specifically allocated for Capital Expenditure to build self-sufficient and integrated manufacturing facilities, including solar power plants.

Credit Rating & Borrowing

Finance costs for H1 FY23 were INR 0.38 Cr, down from INR 0.54 Cr in H1 FY22, despite higher operations. Total borrowings as of September 30, 2025, stood at INR 2.59 Cr (Non-current) and INR 0.45 Cr (Current), suggesting a low-gearing strategy.

⚙️ Operational Drivers

Raw Materials

Raw materials primarily include manganese ore and reductants (coke/coal) required for ferro alloy production. Cost of materials consumed represented 40.3% of total revenue in H1 FY23 (INR 67.29 Cr).

Import Sources

Not specifically disclosed, but the company maintains a steady pipeline of orders and is implementing vendor management strategies to lower procurement costs.

Key Suppliers

The company maintains strong relationships with major steel players who are also likely ecosystem partners, including SAIL, JSW, and Monnet.

Capacity Expansion

The company is focused on building a fully integrated manufacturing facility. It is currently acquiring land for solar plants to ensure energy security and reduce power costs, which are a major component of ferro alloy production.

Raw Material Costs

Raw material costs were INR 67.29 Cr in H1 FY23, making up 40.3% of revenue. Management uses a strict procurement strategy to avoid supply shortfalls and manages inventory to mitigate price volatility.

Manufacturing Efficiency

The company focuses on 'Optimal Utilization of Resources' and 'Process Efficiencies' to drive the 3-year EBITDA CAGR of 112.76%.

Logistics & Distribution

The company operates a logistics and transportation services business to support its core ferro alloy operations, though specific cost percentages are not provided.

📈 Strategic Growth

Expected Growth Rate

18.12%

Growth Strategy

Growth will be achieved through: 1) Capacity expansion funded by the INR 25.41 Cr warrant issue. 2) Market diversification into the USA and Middle East. 3) Cost leadership by establishing captive solar power plants. 4) Increasing the marketing and sales team to strengthen the channel partner network.

Products & Services

Ferro Alloys (used in steel manufacturing) and logistics/transportation services.

Brand Portfolio

Jainam Ferro Alloys.

New Products/Services

Focus on 'Value Added Products' within the ferro alloy category to enhance margins, though specific new product names are not listed.

Market Expansion

Targeting the American and Middle East markets with an expected rollout starting Q4 FY23 (January onwards).

Strategic Alliances

Strong long-term relationships with steel giants SAIL, JSW, and Monnet for steady off-take.

🌍 External Factors

Industry Trends

The industry is shifting toward integrated players with captive power to survive cyclicality. Jainam is positioning itself by moving from a domestic player to an export-oriented integrated manufacturer with solar energy backup.

Competitive Landscape

Competes with other ferro alloy producers in the Raipur industrial belt and larger integrated steel plants with in-house ferro alloy units.

Competitive Moat

Moat is built on 'Customer Centricity' and 'Quality Assurance' (ISO certified), alongside deep-rooted relationships with Tier-1 steel producers like SAIL. Sustainability depends on successful cost reduction via solar integration.

Macro Economic Sensitivity

Highly sensitive to global steel demand and commodity price cycles. Softening prices in late 2022 are noted as a headwind for future margins.

Consumer Behavior

Demand is driven by industrial steel consumption rather than direct consumer behavior.

Geopolitical Risks

Trade barriers or shifts in American/Middle Eastern import policies could impact the planned expansion strategy.

⚖️ Regulatory & Governance

Industry Regulations

Subject to government policies regarding industrial land acquisition and power tariffs, which management cited as a major current challenge.

Environmental Compliance

The company holds ISO 14001:2015 certification for Environmental Management Systems, indicating compliance with industrial pollution norms.

Taxation Policy Impact

Effective tax rate for H1 FY23 was approximately 27.5% (INR 7.78 Cr tax on INR 28.17 Cr PBT).

Legal Contingencies

No specific pending court cases or values were disclosed in the provided financial statements or announcements.

⚠️ Risk Analysis

Key Uncertainties

Volatility in commodity prices (High impact), changes in government power policies (Medium impact), and successful execution of the solar plant project.