In the present work, three composites have been developed by reinforcing Mild Steel (MS) chips in the amounts of 1 wt. %, 2 wt. % 3 wt. % respectively to recycled Aluminium chips through a manual stir-casting process. The developed composites were hot rolled at 200 ℃ to 50% reduction to increase the strength further. The microstructure showed that adding MS chips leads to grain refinement in the matrix due to the promotion of instantaneous nucleation. Further, it was observed that the composite developed by reinforcing 2 wt. % MS chips exhibited better grain refinement and the smallest grain size among the others, which also exhibited the highest hardness and compression strength of 83 Hv and 563 MPa, respectively, which are 26% and 15.3%, respectively, compared to the unreinforced alloy. This improvement in the strength can be attributed to the improved grain refinement, uniform distribution of MS powder in the matrix, formation of secondary phase and dispersion strengthening. However, beyond 2 wt. % addition of MS chips, the grain size started to grow, leading to a decline in the hardness and compression strength. Further, all the hot-rolled samples exhibited better properties than their counterparts. However, the variation trend in properties after hot rolling remained the same as the composite with 2 wt% MS chips showing the highest hardness and compression strength of 106 Hv and 722 MPa, respectively.