SAIL shares surge 3% as profit jumps 5x QoQ in Q4FY25

Revenue was up 20 percent QoQ to Rs 29,316 crore in Q4FY25 from Rs 24,490 crore in Q3FY25. On the operational front, the company's Ebitda grew 72 percent QoQ to Rs 3,484 crore in Q4FY25, while margins expanded by 370 basis points (bps) QoQ to 12 percent.

Following this, Morgan Stanley analysts maintained its "Underweight" rating on SAIL, setting a target price of Rs 90.

The brokerage acknowledged that SAIL's Q4 performance beat expectations in terms of volumes, which came in at 5.3 million tonnes—up 17 percent year-on-year and 20 percent quarter-on-quarter, significantly exceeding the estimate of 4.8 million tonnes. However, after adjusting for the higher volumes, realisations on reported numbers were slightly below estimates.

The company also recognised Rs 690 crore in revenues from rail price revisions applicable for FY24–25, while its operational expenditure per tonne was 2 percent better than expected due to lower raw material costs. As a result, SAIL reported EBITDA of Rs 3,480 crore, which was 24 percent ahead of estimates. On a per-tonne basis, EBITDA also exceeded expectations.

Despite this operational outperformance, Morgan Stanley noted that once one-off items are excluded, EBITDA was in line with expectations, which may explain its cautious stance.

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