SEPA Sold 116% of Its Full-Year 2025-26 Revenue in Seven Months; Twelve-Month Operating Cash Was 3.4% of Profit and Sahmino's Invalidation Is 11,351 Rials (November 6, 2026)

Sepahan Industrial Group (SEPA) sold more in the first seven months of its current financial year than in the entire preceding year. Its Codal monthly filing for the period ended October 22, 2026 records 54,962,300 million rials (5.496 trillion tomans) of sales, against 47,465,868 million rials (4.747 trillion tomans) for fiscal 2025-26, or 116% as much. Yet the November 4 closing price was 11,700 rials, 7.5% below its 52-week high of 12,650 rials on October 31, while reconstructed twelve-month operating cash was only 3.4% of profit. What does the market see that the sales headline misses?

Background

SEPA makes and sells gas and industrial pipes, sheet and coiled steel on the Tehran Stock Exchange's main first-board list. All company statement figures here are standalone, not consolidated. Its unaudited six months ended September 22, 2026 (Codal tracking number 1619876) show 38,398,763 million rials of operating revenue versus 16,176,755 million in the restated, audited comparable 2025 period, and net profit of 15,283,353 million versus 1,121,357 million rials, 13.6 times as much. Second-quarter profit was 9,012,943 million rials, 43.7% above the first quarter's 6,270,410 million. Net sales in September were 13,317,423 million rials, followed by 16,563,537 million in October, a 24.4% monthly increase.

The numbers

A trailing twelve months is reconstructed by adding the latest six months to last year's annual total and subtracting the corresponding six months a year ago. It is not a printed column in the interim filing. Monthly sales are net of sales returns and use the same standalone basis as the income statement: September's cumulative 38,398,763 million rials agrees with that statement; adding October's 16,563,537 gives 54,962,300.

Drivers

Pricing, rather than unit volume, explains the larger revenue. The October filing reports 35,473 tonnes of domestic gas and industrial pipe sold in the seven months at an average 1,322,959,659 rials per tonne (about 132 million tomans), against 41,685 tonnes at 482,843,805 rials in the comparable period. Price was 2.74 times as high while tonnes were 15% lower. Domestic steel coil input also cost more: 874,586,525 rials per tonne versus 381,974,102, a 2.29-fold increase. The spread between selling and input prices widened, consistent with the six-month gross margin reaching 40.8%. In October against September, the pipe price per tonne rose 9.3% and volume 17.8%; revenue on that product rose from 10,681,693 to 13,750,966 million rials.

The income statement has another profit component: other operating income of 2,965,085 million rials compared with 319,673 million a year earlier, equal to 16.8% of current six-month pretax profit of 17,658,379 million. Its main income-statement lines do not explain what generated that category.

The balance sheet gives context to the negative cash flow. From March 20 to September 22, 2026, inventory rose from 15,402,459 to 33,719,103 million rials, a rise of 18,316,644 million or 119%, larger than the six-month operating cash outflow. Borrowings climbed from 3,219,622 to 9,747,148 million rials, roughly threefold. Cash proceeds from borrowing were 13,710,404 million and principal repayments 7,182,878 million: the 6,527,526 million net agrees with that balance-sheet increase. Dividends payable were 5,167,439 million rials (517 billion tomans). Shareholders approved a 400-rial dividend per share at the July 20, 2026 meeting; the company's payment calendar designated October 21 for payment.

Outlook

Exchange-basis P/E is 6.18, using trailing EPS of 1,894 rials and the November 4 close of 11,700 rials in the November 5 nightly reading, against 11.46 for the basic-metals sector, 46% below the sector on the sector figure as denominator. The multiple reconstructed from standalone statements is also about 6.18. Sahmino's November 6 screen of basic-metals equities, requiring a positive trailing P/E below seven, year-on-year profit growth above 100% and average twenty-session turnover above 100 billion rials, returns 19 matches. SEPA is one, though its trailing operating cash is just 802 billion rials versus 23,681 billion rials of profit.

Trading tested that gap: from November 1 to November 4 individuals bought 79.9 million shares and sold 185.2 million, a net sale of 105.3 million shares, worth about 1,266 billion rials (126.6 billion tomans). Institutional investors took the other side. The closing price fell 7.1% from 12,590 rials on October 31 to 11,700 on November 4. The register tells us who traded, not why.

Sahmino's desk has a buy reading dated November 4 for SEPA: reference 11,700 rials, target 12,669 and invalidation 11,351 within fifteen sessions. The close was 7.7% below the target (target as base) and 3.1% above invalidation (invalidation as base). Its open flow-turn signal from November 2 measures an 82.3% target hit rate, lower bound 64.8%, against 51.6% for a random entry under the same regime. Reward to risk was 2.39 at the last traded 11,740 rials, with entry limit 12,449 rials, not yet passed. The November 4 desk stance itself has no calculated probability or sample. Across all settled desk signals, 3,743 of 6,564 (57.0%) reached their target and 2,644 were invalidated; of 3,175 settled desk stances, 1,416 (44.6%) reached target and 1,537 were invalidated.

Conclusion

The market is testing cash conversion: the filings support rising sales and profit and P/E is 46% below the sector, but trailing cash has not kept up with earnings. Sahmino's November 4 desk reading: SEPA holds above 11,351 rials over fifteen sessions and reaches 12,669 rials. Condition: no session closes below 11,351 rials and operating cash does not deteriorate further. Horizon: fifteen trading sessions from November 4. Invalidation: a close below 11,351 rials.

What to track

• November sales against October's 16,563,537 million rials and the pipe selling rate against 1,412,528,608 rials per tonne.
• The next nine-month financial statement's operating cash and inventory against 33,719,103 million rials in September.
• Each session's close against 11,351-rial invalidation and 12,669-rial target: follow the target and invalidation in Sahmino's ideas and signals, and the quote on SEPA's price page.
• The SEPA dividend payment calendar and our September sales analysis.