Nuvama Institutional Equities has initiated coverage on SG Mart Limited with a 'Buy' rating and a target price of ₹777, implying a 22% upside from July 16's closing price of ₹636. According to Nuvama's recent report, the stock is currently trading around ₹646 apiece. The brokerage has assigned SG Mart a valuation of 15 times its FY29 EV/EBITDA, citing the company's revenue and profit growth relative to global peers in metals processing and distribution.
SG Mart Limited began life in April 2023 as an empty shell company called Kintech Renewables, with no business operations, before being acquired by the APL Apollo group family and renamed. As reported by Nuvama, the company was originally positioned to become 'India's largest trading company,' focused on steel and zinc trading. However, that model changed after April 2025, when the collapse of import arbitrage led to a shift from pure trading toward processing, fabrication and distribution. This transformation was driven by the implementation of a safeguard duty on steel imports.
Nuvama forecasts a 73% compound annual growth rate (CAGR) in earnings per share (EPS) between FY26 and FY29, with return on capital employed projected to improve from 10% in FY26 to 27% by FY29. The brokerage notes that promoter holding in the company rose from 36.27% in March 2026 to 57.9% in June 2026, with Nuvama's report attributing the stock's re-rating over the past three to four months to this increase in promoter stake.
According to Nuvama's report, for the period before FY25 and FY26, the company listed 'aggressive revenue/EBITDA ramp up' targets that saw repeated misses, attributed to steel volatility, supply issues, and execution in B2B trading. For FY25, guidance of approximately ₹6,500 crore in revenue came in lower than guided, with margins pressured due to steel price crashes and inventory losses. The report states that 'management often reaffirms longer-term targets despite quarterly/short-term misses, citing ecosystem building and diversification.' Nuvama's risk matrix separately rates guidance credibility as a Medium probability, and a Medium impact risk, with the mitigation listed as 'track record of misses; close monitoring needed.'
