Brokerages Bullish on Shyam Metalics Post Q1FY27: Goldman Sachs, Jefferies, JM Financial, and 360 ONE See Capacity Ramp-Up Drive Growth While Nuvama Stays Cautious
New Delhi, July 23, 2026: Shyam Metalics & Energy (SMEL) delivered a strong Q1FY27 performance, aided by higher realisations, an improving product mix, and growing contribution from value-added businesses. While leading brokerages differed on valuation, analysts across the board highlighted the company’s expansion pipeline, downstream integration, and improving earnings profile as primary drivers for future growth, Shyam Metalics & Energy said in a press release.
Goldman Sachs maintained its Buy rating on the stock and raised its target price to ₹1,120 from ₹1,050. The brokerage described SMEL as a volume-growth-focused company and expects earnings to remain resilient despite seasonal weakness in rebar prices. Goldman believes aluminium, stainless steel, and cold-rolled products will cushion profitability, while the ramp-up of new iron-making facilities and the aluminium foil plant at Sambalpur should drive volumes. It expects EBITDA margins to sustain above 15% in FY27 and raised its FY27–FY29 EBITDA estimates by 1.5–5.5%, citing healthy domestic steel demand, renewable power initiatives, and a strong commissioning pipeline over the next 9 to 12 months.
Jefferies also retained its Buy rating and increased its target price to ₹1,250 from ₹1,150 following what it called a strong June quarter, where EBITDA rose 33% year-on-year to beat its estimates by 19%. Although Jefferies expects some moderation in Q2 profitability due to softer commodity prices and fading raw material inventory benefits, it remains positive on the long-term outlook. The firm highlighted SMEL’s ₹10,000 crore expansion programme aimed at more than doubling carbon steel capacity, expanding stainless steel capacity seven-fold, and strengthening its value-added portfolio, projecting an EBITDA and EPS compound annual growth rate (CAGR) of 17% and 15%, respectively, through FY26–FY29.
JM Financial reiterated its Buy rating and raised its target price to ₹1,250 from ₹1,140, noting that Q1 EBITDA of ₹770 crore aligned with expectations as improved realisations offset lower volumes. The brokerage emphasized continued strength in value-added segments, with stainless steel, aluminium, specialty alloys, and cold-rolled products posting sequential profitability gains. With aluminium standing out as the highest-margin business during the quarter, JM Financial expects downstream expansion, captive power benefits, and renewable energy investments to support management’s target of over 20% growth in revenue and EBITDA in FY27.
Maintaining a more cautious stance, Nuvama retained its Hold rating with a target price of ₹1,014, pointing out that higher steel and aluminium realisations supported a 5% quarter-on-quarter increase in EBITDA to ₹765 crore. While it expects steel profitability to soften in Q2FY27 amid lower market prices, Nuvama remains constructive on medium-term earnings growth driven by capacity additions, volume ramp-up, and an increasing contribution from value-added products. The brokerage also highlighted SMEL’s strong balance sheet and net cash position despite ongoing expansion spending.
Meanwhile, 360 ONE maintained its Buy rating with a target price of ₹1,221, reporting that EBITDA and PAT came in ahead of expectations due to stronger operating leverage and higher other income. The brokerage remains positive on the company’s diversification strategy, particularly its growing exposure to aluminium and stainless steel, noting that management’s guidance for over 20% revenue and EBITDA growth in FY27 reinforces confidence in its overall earnings trajectory.
Overall, the prevailing consensus across Wall Street and Indian brokerages centres on SMEL’s strategic transition toward a higher-margin, value-added metals portfolio. Ongoing capacity ramp-ups, downstream integration, renewable energy initiatives, and a solid financial balance sheet are broadly expected to support sustained earnings growth and improved investor returns over the medium term.
