Beekay Steel Indus has received rating affirmation from India Ratings and Research (Ind-Ra), which has maintained the existing IND A/Stable rating on the company's bank loan facilities. The rating agency announced this decision on December 9, 2025, covering bank loan facilities worth ₹4,230 million with IND A/Stable/IND A1 rating and additional facilities of ₹610 million with IND A/Stable rating.

Rating Rationale and Key Strengths

The ratings reflect Beekay Steel's EBITDA stability emanating from its conversion business, adequate liquidity position, and comfortable credit metrics. India Ratings expects the company's operational performance to recover in 2H FY26 after a subdued 1H FY26, supported by the commercialisation of the Cuttack unit in 2Q FY26 and likely increase in conversion volumes.

Financial Performance Analysis

The company's financial performance in 1H FY26 showed mixed results compared to previous years. While Beekay Steel maintained a steady revenue profile, its operational EBITDA was impacted during the period due to several factors including a dip in conversion volumes in 1Q FY26 following a temporary plant shutdown by key customer Tata Steel Limited for planned maintenance.

Operational Developments and Recovery Prospects

Beekay Steel has revamped and restarted facilities in its Cuttack unit, with commercial production of sponge iron commencing in December 2024. Operations in ferroalloys, power plant, rolling mill, and steel melting shop units commenced in 2Q FY26. The Cuttack unit's strategic location provides logistical advantages, and the restart of operations is expected to increase the scale of operations in the near-to-medium term.

The company's sales volumes from the own-manufactured segment are likely to range between 1,00,000-1,20,000 MT in FY26. The ramp-up of capacity at the Cuttack plant and sustained demand from construction, automobile, railways, and infrastructure sectors are expected to drive revenue and EBITDA growth over the medium term.

Conversion Business Stability

The conversion business continues to underpin margin stability and provide steady cash flows to Beekay Steel. This segment, which caters to Tata Steel Limited, accounted for approximately 21.10% of total sales volumes in 1H FY26, compared to 17.30% in FY25 and 18.90% in FY24.

Credit Metrics and Financial Position

India Ratings expects Beekay Steel's credit profile to remain comfortable over FY26-FY27, in absence of any significant debt-funded capex. The company's subdued operational performance weighed on its credit metrics in 1H FY26, with interest coverage declining to 3.86x from 7.04x in FY25 and gross leverage increasing to 3.88x from 2.43x in FY25.

Risk Factors and Outlook

The ratings are constrained by price volatility risk and customer concentration risk. As a non-integrated player, the company's manufacturing business is susceptible to volatility in raw material and finished goods prices. Tata Steel group entities contributed approximately 23.13% to revenue in FY25, though the agency expects conversion contracts to continue being rolled over given the length of relationships and renewal of agreements with additional capacities.

Beekay Steel Industries Ltd (ISIN: INE213D01015) has initiated a postal ballot process to seek shareholder approval for two significant board appointments, signaling a strategic move to strengthen its leadership team.

Key Appointments

1. Whole-time Director (Operation):

   • Name: Lokanath Sahu
   • Proposed Term: 5 years
   • Effective Date: November 12, 2025
   • Remuneration: Rs 2,94,320 per month

2. Independent Director:

   • Name: Binod Kumar Tulsyan
   • Proposed Term: 5 years
   • Effective Date: November 12, 2025

Postal Ballot Details

Company Financial Overview

To provide context for these appointments, let's look at Beekay Steel Industries' recent financial performance:

The company has shown significant growth in its asset base and shareholder capital over the past year, indicating a period of expansion and financial strengthening.

Strategic Implications

1. Operational Expertise: The appointment of Lokanath Sahu as Whole-time Director (Operation) suggests a focus on enhancing operational efficiency, potentially leveraging his specialized expertise in DRI operations.

2. Corporate Governance: Bringing in Binod Kumar Tulsyan as an Independent Director aligns with best practices in corporate governance, potentially bringing fresh perspectives and independent oversight to the board.

3. Growth Strategy: These appointments, coupled with the company's financial growth, indicate a strategic move towards strengthening both operational capabilities and board oversight as Beekay Steel Industries positions itself for future growth.

Shareholders are encouraged to participate in the e-voting process to have their say in these crucial appointments that could shape the company's future direction and performance.

Note: All financial figures are based on the standalone financial statements as of March 2025.