Shah Alloys Ltd, a prominent player in the Indian steel industry, has announced significant changes in its board composition and reported financial results for the first quarter, amidst plans to shut down its iron and steel plant operations.

Board Appointment and Continuation

The company's board has appointed Smt Nipa Jairaj Shah as an Additional Non-Executive Independent Director for a five-year term, effective August 14, 2025, subject to shareholder approval at the upcoming Annual General Meeting (AGM). Smt Shah brings over five years of experience in social management activities, particularly in CSR and relationship management.

In a separate move, the board approved the continuation of Shri Ashok Sharma as Whole Time Director, despite his reaching 70 years of age. Sharma, who has been with the company since July 2001, boasts over 40 years of experience in senior finance and accounting positions.

Financial Performance

For the quarter ended June 30, 2025, Shah Alloys reported:

All figures in Rs crore

The company's revenue from operations saw a significant decline compared to the same quarter in the previous year, while the net loss narrowed.

Plant Closure and Future Plans

In a critical development, Shah Alloys announced the closure of its Iron and Steel plant located at Santej, Gujarat, by the end of August 2025. The decision comes in response to technological obsolescence and higher production costs, which have led to persistent losses in recent years.

The company's management stated that they are exploring various options in the best interest of Shah Alloys, emphasizing that the accounts have been prepared on a "going concern" basis despite the plant closure.

Auditor's Concerns

The company's auditors have expressed concerns about Shah Alloys' status as a going concern due to the plant closure. They also noted that the company has not made provisions for interest on bank loans, which would have increased the reported loss by Rs 36.55 lakhs for the quarter.

Annual General Meeting

The board has scheduled the 35th Annual General Meeting for September 26, 2025, where shareholders will have the opportunity to vote on these significant changes and financial results.

As Shah Alloys navigates through this challenging period of restructuring and plant closure, stakeholders will be keenly watching the company's next steps and its ability to return to profitability in the coming quarters.

Shah Alloys Limited, a Gujarat-based steel manufacturer, has announced the closure of its entire Iron and Steel Plant operations at Santej, Gujarat. The decision, approved by the company's board of directors, marks a significant shift in the company's operations and future strategy.

Closure Details

The company expects to complete the shutdown process within one month. This closure affects the plant situated at Village Santej, Taluka-Kalol, District Gandhinagar, Gujarat-382721.

Financial Impact

The closure of the Santej plant will have a substantial impact on Shah Alloys' operations:

The plant, which accounted for 100% of the company's operations, generated revenue of Rs 26,728.00 lakh. However, it also recorded a significant loss after tax of Rs 2,729.00 lakh.

Reasons for Closure

Shah Alloys cited several factors contributing to the plant's closure:

1. Lack of Competitiveness: The aging plant and machinery have rendered the operations uncompetitive in the current market.
2. Technological Obsolescence: The existing technology is outdated, leading to inefficiencies in production.
3. Higher Production Costs: The company is unable to recover the increased production costs from customers, making operations financially unsustainable.
4. Consistent Losses: The Iron and Steel Plant has been incurring losses for several years, draining the company's resources.

Future Plans

Following the shutdown, Shah Alloys plans to explore new options that align with the company's best interests. The management views this closure as a necessary step to stem ongoing losses and position the company for potential future opportunities.

Regulatory Compliance

The closure decision was made in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company has duly informed the BSE Limited and the National Stock Exchange of India Ltd. about this development.

As Shah Alloys Limited moves forward with this significant operational change, stakeholders will be keenly watching the company's next steps and its strategy to navigate the challenges in the steel industry.