VMS TMT IPO: Check IPO Date, Lot Size, Price & Details

Introduction:

VMS TMT Limited is a Gujarat-based manufacturer of Thermo Mechanically Treated (TMT) bars, catering primarily to the construction and infrastructure sectors. The company operates a modern manufacturing facility at Bhayla village, near Ahmedabad, with an annual installed capacity of 200,000 MT of TMT bars. Over FY23–FY25, production ranged from 161,807 MT in FY23, 160,321 MT in FY24, and 126,065 MT in FY25, reflecting utilization levels between 63–81% .

In September 2024, the company completed a backward integration project with a 30-ton induction furnace and a 216,000 MT billet casting capacity, supported by a 22,000 kVA power substation. This integration allows VMS to manufacture billets from scrap, reducing dependence on external suppliers .

The company is also setting up a 15 MW solar power plant in Banaskantha, Gujarat, to reduce energy costs for its energy-intensive operations .

Its sales network is concentrated in Gujarat, comprising 3 distributors and 227 dealers (as of July 31, 2025). VMS markets its products under the “Kamdhenu NXT” brand via a retail license agreement with Kamdhenu Limited, enabling strong brand recall in its core markets

IPO Details:

Objectives of Issue:

• Repayment/ prepayment, in full or part, of all or a portion of certain borrowings availed by the Company
• General corporate purposes

Key Strengths:

• Strong Manufacturing Infrastructure and Backward Integration: VMS operates an integrated facility with automated rolling mills and a billet casting division. The ability to produce billets internally through its induction furnace enhances raw material security and reduces reliance on third-party billet suppliers. This backward integration not only lowers input cost volatility but also improves supply chain efficiency. With automated processes (PLC-based mill synchronization, tensile metal rolls for quality, etc.), the company ensures consistency, cost competitiveness, and scalability .
• Tie-up with a Reputed National Brand (Kamdhenu NXT): By leveraging Kamdhenu Limited’s “Kamdhenu NXT” brand under a retail licensing agreement, VMS benefits from a trusted national brand identity without incurring large upfront marketing expenditures. Kamdhenu is widely recognized in Tier II and Tier III cities for its quality and innovation in TMT products. The branding helps VMS command better visibility, credibility, and dealer acceptance in Gujarat’s competitive market. While licensing involves royalty payments, the trade-off provides strong brand equity at a fraction of the cost of building its own brand from scratch. This arrangement helps VMS punch above its weight compared to other mid-sized, regional manufacturers.
• Demonstrated Ability to Scale Operations: Since inception, VMS has steadily enhanced its production capabilities — from rolling TMT bars to now producing billets through backward integration. Installed TMT rolling capacity stands at 200,000 MT annually, while billet casting is at 216,000 MT per year, both supported by an upgraded 22,000 kVA power substation. This scale allows the company to quickly ramp up production in response to demand, without significant incremental capex. With capacity utilization averaging 63–81% in FY23–FY25, there remains sufficient headroom to grow volumes by 20–30% as market demand expands. The ability to scale efficiently positions VMS as a credible supplier to larger infrastructure and housing projects.

Risks

• High Geographic Concentration and Market Dependency: With more than 98% of revenue derived from Gujarat, VMS is overexposed to a single regional market. Any economic slowdown, policy change, or demand contraction in the state could severely impact its operations. Expansion outside Gujarat remains limited, and building brand recognition beyond its home market will require significant investments in distribution, marketing, and working capital. Geographic concentration poses a structural growth limitation compared to pan-India peers .
• High Working Capital Intensity: Steel rolling businesses typically require significant working capital due to inventory stocking of raw materials (scrap, billets) and finished goods, along with credit offered to dealers. For VMS, working capital requirements are substantial, with current assets forming a large part of the balance sheet. In FY25, trade receivables and inventories together accounted for over 60% of current assets, reflecting liquidity tied up in operations. Any delay in receivables or need for larger inventory could strain cash flows. Given its high leverage, incremental working capital borrowings may further elevate debt levels and interest costs. Managing liquidity efficiently becomes critical, and any disruption in working capital cycle could materially impact profitability and solvency.
• Intense Competition and Commodity Nature of Business: The TMT bar market is fragmented, with numerous regional players and large integrated steel producers. While the Kamdhenu NXT brand provides recognition, VMS operates in a highly competitive segment where pricing is often dictated by market demand and raw material costs. Larger peers like Kamdhenu, SAIL, and Electrotherm enjoy wider geographic reach, scale benefits, and better bargaining power. As TMT bars are commodity products, differentiation is limited, and customers may easily switch based on price. This intense competition puts sustained pressure on pricing power and margins, especially during downturns. Without consistent cost advantages or expansion beyond Gujarat, the company may struggle to defend market share and profitability against both local and national rivals.

Financial Snapshot:

Peer Comparison