Surya Roshni Receives New Orders Worth Rs 215 Crore

Surya Roshni Ltd. on Wednesday received two new orders worth Rs 215 crore for different coated pipes. Shares of Surya Roshni rose nearly 5% after it got orders from Hindustan Petroleum Corp. and a domestic entity.

HPCL has placed an order for API 5L Gr. X, 3LPE coated line pipes for Rajasthan and Jharkhand, worth Rs 106.01 crore, according to an exchange filing. On the other hand, a domestic entity has placed an order for food grade epoxy coated, spirally welded HSA W MS pipes for Madhya Pradesh worth Rs 108.67 crore.

While the company has to complete the order for HPCL in 40 weeks, the order for the domestic entity is to be completed in 15 weeks.

Surya Roshni reported a 55% year-on-year fall in net profit to Rs 34.16 crore in the quarter ended Sept. 30, 2024, compared to Rs 76.01 crore in the same quarter of the previous fiscal, according to its stock exchange notification.

Revenue fell by 20.2% year-on-year to Rs 1,528.89 crore in the second quarter. Operating income, or earnings before interest, taxes, depreciation, and amortisation, fell 45% year-on-year to Rs 76.23 crore. The Ebitda margin contracted by 220 basis points to 5% from 7.2% in the same period the previous year.

The steel pipes business of the company experienced sharp decline in hot rolled steel prices.

"Dampened demand resulted in lower revenues. However, operational efficiencies helped mitigate losses arising due to price erosion," the company said in a press release.

Surya Roshni stock rose as much as 4.98% during the day to Rs 567.05 apiece on the NSE. It pared some gains to close 4.82% higher at Rs 566.20 per share. This compares with a 0.3% advance in the benchmark Nifty 50. It has risen 11.71% in the last 12 months, but fallen 29.08% year-to-date.

The one analyst tracking the company recommends a 'hold', according to Bloomberg data. The average of 12-month analysts' consensus price target implies an upside of 6.8%.