Shyam Metalics shares surge to record on aluminium foil output
Shyam Metalics shares touched a record high after its subsidiary began commercial production at a new aluminium foil facility, a move the company projects will significantly boost margins and double its revenue.
Shyam Metalics and Energy shares surged 2.4% to an all-time high of ₹1,059 on Thursday, driven by the formal start of commercial production at a new aluminium foil facility. The stock opened slightly below its previous close of ₹1,033.90 at ₹1,028.05 before the rally took hold. By mid-afternoon, the shares had trimmed some of those gains to trade up 0.63% at ₹1,040.40.
The catalyst for the price action was an exchange filing detailing operational progress at SMEL Steel Structural Pvt. Ltd., a step-down subsidiary. The new plant, located in Sambalpur, Odisha, is now producing premium-grade aluminium foil. It brings 18,000 tonnes per annum (TPA) of installed capacity online, manufacturing foils in the 6 to 40 micron thickness range.
This foil plant represents the first phase of a broader manufacturing expansion. SMEL Steel confirmed that a separate aluminium flat rolled products (FRP) facility is in its final readiness phase. That unit is scheduled for a commercial launch by September 2026. Once operational, the FRP line will add 60,000 TPA of capacity, covering a thickness spectrum of 0.3 to 4.0 mm.
For market participants, the significance of these additions lies in their projected impact on profitability. Shyam Metalics expects the transition toward value-added aluminium products to lift SMEL’s operating margins by roughly 40% to 50%. The company attributes this margin expansion to an optimized product mix and higher per-unit product realizations compared to standard offerings.
The revenue implications are similarly substantial. Management projected that the enhanced market reach and distribution capabilities—spanning both domestic and international markets—will expand the company's topline by two to 2.5 times. Achieving that scale would mark a fundamental shift in the company's earnings profile.
The stock market has been pricing in this operational transformation over recent months. Since bottoming at a 52-week low of ₹745.65 on March 16, the shares have mounted a steady recovery. Year-to-date, the stock is up more than 23%, including a 21% gain over the past three months and a 9% advance in July alone.
