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Key Points

VMS TMT has reported an 11.8% decline in revenue ahead of its upcoming IPO. Despite the revenue drop, the company's net profit actually increased by 14.5% during the same period. The IPO is set to launch on September 17 with a fresh issue of 1.5 crore shares. The company plans to use most of the proceeds to repay its existing borrowings of Rs 261.7 crore.

Key Points: VMS TMT Revenue Dips 12% Ahead of Kamdhenu Brand IPO Launch

  • Revenue declined 11.8% to Rs 770.2 crore in FY25 despite profit growth
  • IPO opens September 17 with fresh issue of 1.5 crore equity shares
  • Company plans to use Rs 115 crore from proceeds to repay borrowings
  • Manufacturing TMT bars under Kamdhenu brand with 2 lakh tonne capacity
2 min read

VMS TMT's revenue falls nearly 12 pc ahead of IPO, shows DRHP

VMS TMT reports 11.8% revenue decline to Rs 770.2 crore in FY25 but net profit rises 14.5% ahead of its September 17 IPO launch for Kamdhenu steel bars.

"Despite the fall in sales, its net profit rose 14.5 per cent to Rs 15.4 crore - Company DRHP"

Mumbai, Sep 12

Gujarat-based steel bars manufacturer VMS TMT has reported a 11.8 per cent dip in its revenue ahead of its initial public offering (IPO).

According to its red herring prospectus (RHP), the company’s revenue declined to Rs 770.2 crore in the financial year 2024–25 (FY25), compared to the previous fiscal (FY24).

However, despite the fall in sales, its net profit rose 14.5 per cent to Rs 15.4 crore during the same period.

VMS TMT, which makes thermo mechanically treated (TMT) steel bars under the Kamdhenu brand, has filed its RHP with the Registrar of Companies and is set to launch its IPO on September 17.

The offering will consist entirely of a fresh issue of 1.5 crore equity shares, with all proceeds going directly to the company.

The IPO anchor book for institutional investors will open on September 16, and the issue will close for subscription on September 19.

The company plans to use Rs 115 crore from the IPO proceeds to repay borrowings, while the rest will be set aside for general corporate purposes.

As of June, its total borrowings stood at Rs 261.7 crore. The issue structure reserves 50 per cent of shares for retail investors, 30 per cent for qualified institutional buyers and the remaining 20 per cent for non-institutional investors.

VMS TMT operates primarily in Gujarat, manufacturing TMT bars from scrap and billets at its Bhayla Village plant in Ahmedabad, which has an installed capacity of two lakh metric tonnes per year.

The company’s IPO allotment will be finalised by September 22, with a planned listing on the stock exchanges on September 24.

The company had earlier filed draft IPO papers with SEBI on March 27, which were cleared on July 21. Arihant Capital Markets is acting as the sole book-running lead manager for the issue.

- IANS

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Reader Comments

P
Priya S
Construction sector has been slow this year across Gujarat. Many infrastructure projects delayed due to monsoon and elections. Not surprising that steel companies are facing revenue pressure.
A
Aman W
Using IPO money to repay debt is always a red flag for me. Why should public money bail out their borrowing decisions? They should have managed debt better before going public.
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Sarah B
Kamdhenu is a decent brand in western India. If they're expanding and the valuation is reasonable, this could be a good long-term bet. Construction materials always have demand in growing economy like India.
V
Vikram M
₹261 crore debt on ₹15 crore profit? That debt-to-equity ratio looks scary. Hope they disclose their interest coverage ratio in the RHP. Retail investors should be very careful with this one.
N
Nikhil C
Timing seems strategic - launching IPO when markets are at all-time high. Smart move by company but investors should check if the fundamentals justify the valuation they're asking for.

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