1. High debt levels: Mechel PAO has a high debt-to-equity ratio compared to its peers, which makes it vulnerable to economic downturns and increases the risk of default.
2. Limited diversification: The company is heavily reliant on the coal and steel industries, which can be volatile and subject to fluctuations in demand and pricing.
3. Poor financial performance: Mechel PAO has struggled to generate consistent profits in recent years, with net losses reported in several quarters.
4. Limited growth prospects: The company's operations are primarily focused on Russia, which limits its potential for expansion into new markets and industries.
5. Environmental concerns: Mechel PAO has faced criticism for its environmental practices, particularly in relation to its coal mining operations.
6. Regulatory risks: The company operates in a heavily regulated industry, which exposes it to potential legal and regulatory challenges.
7. Reputation issues: Mechel PAO has faced allegations of corruption and unethical business practices, which could damage its reputation and impact its ability to attract investors and customers.