SAIL Share Price: Is the Stock a Buy or Sell Post Q4 Results and Dividend Announcements?

New Delhi, May 29, 2025 — Shares of Steel Authority of India Ltd (SAIL) have been in the spotlight following the company’s Q4 FY24 earnings release and a final dividend announcement. The state-run steel giant posted a mixed bag of results for the March quarter, drawing a sharp reaction from investors and prompting a debate on whether the stock is a buy, sell, or hold at current levels.

With rising demand for infrastructure and capital goods, alongside fluctuating global steel prices, SAIL’s performance is being closely watched by retail and institutional investors alike.

Q4 FY24 Earnings Snapshot: Margins Improve, Revenue Dips Slightly

SAIL reported its Q4 results late on Wednesday, with the numbers reflecting both operational challenges and improving efficiency.

Key Financials (Consolidated):

• Revenue from Operations: ₹28,304 crore vs ₹29,130 crore YoY (down 2.83%)

• Net Profit: ₹1,065 crore vs ₹1,159 crore YoY (down 8.1%)

• EBITDA: ₹4,231 crore vs ₹3,897 crore YoY (up 8.57%)

• EBITDA Margin: Improved to 14.95% from 13.37%

• Final Dividend: ₹1.00 per equity share

Despite a drop in topline and bottom-line year-on-year, the company managed to post a sequential improvement in margins, helped by better realizations, operational efficiencies, and cost optimization efforts.

Dividend Announcement: Modest but Stable

The Board of Directors declared a final dividend of ₹1 per equity share, subject to shareholder approval. This comes after the company paid an interim dividend of ₹1.50 per share earlier in the year, bringing the total dividend payout for FY24 to ₹2.50.

This reflects a dividend yield of approximately 2.45% based on the stock's current market price of ₹102, maintaining SAIL's image as a reliable dividend payer among PSU stocks.

Stock Reaction: Volatility Marks Post-Earnings Trade

Following the results, SAIL share price opened marginally higher on Thursday but witnessed some profit booking intraday.

• Previous Close (May 28): ₹102.20

• Day’s High (May 29): ₹104.10

• Day’s Low: ₹101.25

• At 2 PM: Trading flat around ₹102.35

The muted stock reaction suggests that much of the Q4 performance and dividend news may have been already factored in. However, analysts believe the stock is at an inflection point driven by industry fundamentals and upcoming triggers.

One-Year Performance: Recovery in Focus

Over the past 12 months, SAIL shares have climbed around 28%, outperforming the broader Nifty Metal index, which gained about 17% during the same period. The stock had underperformed in FY23 due to weak global demand and high input costs but has been on a recovery path since Q3 FY24.

nalyst Views: Should You Buy, Sell, or Hold?

Bullish Case:

1. Demand Revival – Domestic infrastructure spending and railway expansion projects are expected to boost steel demand in FY25.

2. Deleveraging Focus – SAIL continues to reduce debt, with gross debt down to ₹26,000 crore from ₹29,800 crore in FY23.

3. Improved Operating Metrics – EBITDA margin recovery and better realizations are encouraging signs.

“The worst seems to be over for SAIL. With crude steel output picking up and input costs normalizing, we expect a better earnings trajectory in FY25,” says Nilesh Jain, AVP Derivative Research at Centrum Broking.

Bearish Case:

1. Muted Export Outlook – Global trade remains weak amid geopolitical tensions and softening Chinese demand.

2. PSU Overhang – Being a government-run entity, policy overhang and bureaucratic inefficiencies remain concerns.

3. Dividend Yield Disappointment – Some investors expected a higher dividend payout post-earnings.

“While operational performance has improved, SAIL remains susceptible to cyclical downturns and lacks pricing power in export markets,” notes Kunal Bothra, Independent Analyst.

Steel Sector Outlook: Tailwinds Emerging, But Caution Persists

The Indian steel sector is seeing a cautiously optimistic recovery. Domestic demand is expected to rise 7–8% in FY25, driven by real estate, railways, and infrastructure development. However, global steel prices remain volatile due to oversupply from China and soft Western demand.

SAIL, with its large integrated operations and government backing, remains well-placed to ride the domestic wave but may continue to face global headwinds.

Technical View: Key Levels to Watch

From a technical standpoint, SAIL is trading near its 200-day moving average.

• Support Zone: ₹98–₹100

• Resistance Level: ₹106–₹110

• Relative Strength Index (RSI): 53 (Neutral)

If the stock sustains above ₹106, analysts see potential for a breakout toward ₹115 in the short term. However, a breach below ₹98 could trigger further downside to ₹94 levels.

What to Watch Ahead

Here are key upcoming triggers that could influence SAIL's stock price trajectory in the near to medium term:

Valuation Check: Is SAIL Undervalued?

At a current P/E ratio of 6.7x (TTM), SAIL trades at a discount to its 5-year average P/E of 8.3x, indicating valuation comfort for long-term investors.

For value investors, these metrics may present a compelling case, especially when compared to private sector peers.

Institutional Activity: Mixed Bag

According to March 2025 shareholding data:

• FIIs: 7.9% (Flat QoQ)

• DIIs: 17.5% (Up 0.6% QoQ)

• Government Holding: 65%

• Public Retail Investors: 9.6%

The increase in DII stake suggests improving domestic sentiment, even as FIIs remain cautious amid global uncertainties.

Hold with Positive Bias, Accumulate on Dips

SAIL’s Q4 results indicate that the company is stabilizing operationally, and its dividend payout, although modest, reflects cash flow confidence. For long-term investors, especially those with a high-risk appetite, the stock offers a decent value proposition, backed by recovery in the steel cycle and policy support from the government.

However, global demand-supply dynamics, commodity volatility, and PSU-linked inefficiencies are challenges to watch.

Verdict:

• Long-term Investors: Accumulate gradually on dips

• Short-term Traders: Watch ₹106 for breakout; maintain stop loss at ₹98

• Dividend Investors: Hold for yield and steady cash flow