Sandur Manganese: Mining-to-Steel Powerhouse for Shareholders

Sandur Manganese & Iron Ores leads in Karnataka mining with iron ore and manganese output, now pivoting to speciality steel via Arjas Steel acquisition. This forward integration cuts raw material costs and boosts margins, directly benefiting shareholders through higher profits and stable cash flows. With mining limits raised to 4.45 MTPA iron ore and 0.6 MTPA manganese, volumes surged, fueling massive growth.​ Q2 FY26 revenue jumped 374% YoY to Rs 1,232 crore, driven by 335% manganese volume growth, 137% ferroalloys, and 79% steel rise. EBITDA soared 355% to Rs 273 crore, PAT up 331% to Rs 139 crore despite margin dip to 22% from costs. H1 FY26 PAT hit Rs 305 crore, up 73% YoY, showing strong execution post-Arjas buyout that adds 0.585 MTPA steel capacity.​ Strategic moves like coke contracts hedging 46% output stabilize earnings amid volatility. ROE at 19% and ROCE 21% reflect efficient capital use, with EV/EBITDA at 10x below historical peaks. Shareholders gain from self-funded expansions, synergies like captive ore to steel plants, and resilient ancillary power/coke units, compounding value long-term.​ New Garret Coiler at Tadipatri expands product mix, targeting auto sector demand. Debt at Rs 1,020 crore is manageable with current ratio 1.96. This diversified model turns mining cycles into steady returns via steel upside. Margin squeezes from coal prices or steel slumps pose risks, potentially hurting near-term profits if volumes stall. Yet, scale, integration, and India's mining push make it overwhelmingly beneficial for patient shareholders, far outweighing volatility with re-rating potential.