Table of content
Aditya Ultra Steel Introduction
Aditya Ultra Steel Limited, founded in 2011, specializes in manufacturing rolled steel products, particularly TMT bars under the Kamdhenu brand. These products primarily serve the construction and infrastructure sectors
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Brief about Aditya Ultra Steel
Summary of the business of Aditya Ultra Steel
Company is engaged in the business of manufacturing rolled steel product i.e. TMT bars under the Kamdhenu brand catering mainly to the construction industry and for infrastructure development. Our Company manufactures TMT bars from billets through reheating furnace and rolling mill. We have a history of more than twelve 12 years in manufacturing of TMT bars industry. We design and manufacture TMT bars and sell it on B2B Basis. Our customer base in mainly spread across the State of Gujarat and also to certain customers in the State of Madhya Pradesh, State of Punjab & Haryana, State of Rajasthan, State of Uttar Pradesh and State of Maharashtra. We have our manufacturing plant located in Survey No-48, Wankarner Boudry, Bhalgam, National Highway 8-A, Wankaner, Rajkot, Wankaner, Gujarat-363621, India which is equipped with testing laboratories, workers’ accommodation, canteen and well-connected transport facilities.
Aditya Ultra Steel History
Company was incorporated as a private limited company in the name and style of ‘Aditya Ultra Steel Private Limited’ on July 27, 2011 with the Registrar of Companies, Gujarat at Dadra and Nagar Haveli under the provisions of the Companies Act, 1956. Subsequently, our Company was converted into a public limited company and the name of our Company was changed from ‘Aditya Ultra Steel Private Limited’ to ‘Aditya Ultra Steel Limited’ and a fresh certificate of incorporation dated July 26, 2018 was issued by the Registrar of Companies, Gujarat at Ahmedabad.
| Year | Key Events / Milestone / Achievements/ Awards/ Recognitions/ Accreditations |
| 2011-12 | Incorporation of the Company on July 27, 2011 by Dipen Rameshbhai Faldu, PramodkumarMadhavjibhai Makadia, Chirag Lakhani and Yogesh Premjibhai Suvariya. |
| 2016-17 | Change in Management- Mr. Varun Manojkumar Jain and Mrs. Varuna Jain purchased all the equity shares from erstwhile promoters and were appointed as Directors of the Company |
| 2018-19 | Company was converted into Public Company. |
| 2018-19 | Achieved revenue from operations of more than ₹ 300 Crores. |
| 2021-22 | Achieved revenue from operations of more than ₹ 500 Crores. |
Aditya Ultra Steel Promoters & Board of Directors
- The promoters of Aditya Ultra Steel Company are Mr. Sunny Sunil Singhi, Mr. Varun Manojkumar Jain and Mr. Varuna Jain.
Aditya Ultra Steel Board of directors
| Name of Directors | Designation |
| Mr. Sunny Sunil Singhi | Chairman and Managing Director |
| Mr. Varun Manojkumar Jain | Non-Executive Director |
| Mrs. Sapna Jain | Non-Executive Independent Director |
| Mr. Piyush Ravishanker Bhatt | Non-Executive Independent Director |
Aditya Ultra Steel Share Holding pattern
| Names | % Shares Held* |
| Promoters | |
| Mr. Varun Manojkumar Jain | 23.65% |
| Mr. Sunny Sunil Singhi | 35.27% |
| Mrs. Varuna Jain | 39.02% |
| Sub Total | 97.94% |
| Public | |
| Chanakya Opportunities Fund | 0.89% |
| Kamdhenu Limited | 1.15% |
| Other Individual Shareholders | 0.02% |
| Sub Total | 2.06% |
Strength
- Qualified and experienced management team
- Skilled and dedicated manpower
- Strategically located Manufacturing Plant
- Existing customer relationship
- Cordial relationship between management and labour
- Flit of Company Owned Vehicle
Strategies
- Premium quality TMT Rebar player with focus on Retail Customers
- Augment our working capital base in order to better utilize our installed capacity
- Focus on consistently meeting quality standards
- Optimal Utilization of Resources and Incentives
Industry Outlook
The TMT (Thermo-Mechanically Treated) bar market in India is on a growth trajectory, driven by the expanding construction and infrastructure sector. India ranks seventh globally as a producer of crude steel, with the iron and steel sector contributing significantly to the country’s socio-economic development.
The TMT bar market is expected to grow at a CAGR of 4.34% between 2022 and 2027, reaching a market size of USD 84.39 billion. The market is driven by the benefits of TMT steel bars over other steel bars, the expanding global industry, and the rising need for steel. TMT bars are known for their exceptional ductility, strength, weldability, and corrosion resistance, making them suitable for a wide range of construction applications. They are available in various grades such as Fe-415, Fe-500, Fe-550, and Fe 500D, and in diameters ranging from 8 to 40 millimetres.
The Indian market has a variety of TMT bar producers, including Shyam Steel, Essar Steel, TATA Steel, Jindal Steel & Power Ltd., JSW Steel Ltd., Kamdhenu Ltd., Primegold International Ltd., and Rashtriya Ispat Nigam Ltd. In terms of regional analysis, the TMT bar market in India can be segmented into Northern Region, North-Eastern Region, Eastern Region, Central Region, Western Region, and Southern Region.
The market is influenced by factors such as infrastructure development, construction activities, and government policies. For instance, the Indian government’s focus on infrastructure development, affordable housing, and smart cities is expected to drive the demand for TMT bars in the coming years. However, the TMT bar market in India also faces challenges such as rising iron ore costs and trade wars between countries, which can impact the supply and demand dynamics of the market. Despite these challenges, the TMT bar market in India is expected to grow due to the increasing demand for steel in contemporary designs and the rising demand for steel in the construction sector. In conclusion, the TMT bar market in India is poised for growth, driven by the expanding construction and infrastructure sector, the benefits of TMT steel bars, and government initiatives. However, the market also faces challenges such as rising iron ore costs and trade wars, which need to be addressed to ensure sustainable growth.
Key TMT Steel Bar Market Challenge
The availability of substitute materials is a major challenge faced by the TMT steel bar market. The growth of the global TMT steel bars market can negatively impact the availability of substitute materials in the construction industry during the forecast period. Reinforced concrete is a common alternative to steel in construction. It involves embedding steel bars (rebar) within the concrete to provide tensile strength.
Moreover, the substitutes offer advantages such as corrosion, resistance, lightweight construction, and easier handling. In order to meet this demand, the TMT steel bar manufacturers may have to explore ways in which options for specialization can be provided. Thus, the availability of substitute materials will hamper the growth of the market focus during the forecast period.
Key TMT Steel Bar Market Driver
The increasing use of electric arc furnaces is a key trend in the TMT steel bar market. The steel industry accounts for the major consumption, and high energy usage has caused the cost of production to increase. The processes and sources of energy required for manufacturing crude steel are the deciding factors of the required amount of energy. Traditionally, blast furnaces are used in processing iron ore to pig iron, which is further used to manufacture crude steel.
However, according to the demand for steel on the market, as well as the availability of material, EAF shall be able to accommodate a flexible production volume of steel. Therefore, the added advantage of EAF is attracting steelmakers toward it, which will drive the growth of the market in focus during the forecast period.
Business Data
Verticals
- TMT Bars
- Scrap, By Products & Others
- MS Billets / Ingots
Product wise break-up
(₹ in Lakh, except %)
| Particulars | 2024 | 2023 | 2022 | |||
| Amount | % | Amount | % | Amount | % | |
| TMT Bars | 51,410.01 | 87.46% | 50,695.89 | 95.57% | 49,258.99 | 95.58% |
| Scrap, By Products & Others | 4,141.21 | 7.05% | 2,348.89 | 4.43% | 2,273.68 | 4.41% |
| MS Billets / Ingots | 3,228.87 | 5.49% | 0 | 0 | 2.86 | 0.01% |
Revenue contribution from Geography presence
(₹ in Lakh, except %)
| Particulars | 2024 | 2023 | 2022 | |||
| Amount | % | Amount | % | Amount | % | |
| Gujarat | 57,906.28 | 98.51% | 52,229.96 | 98.46% | 50,766.88 | 98.51% |
| Others | 873.8 | 1.49% | 814.83 | 1.54% | 768.65 | 1.49% |
Customer dependency
| Particulars | FY 2023-24 | FY 2022-23 | FY 2021-22 |
| Top 1 | 56.84% | 47.50% | 41.63% |
| Top 3 | 83.38% | 79.45% | 78.66% |
| Top 5 | 90.93% | 93.09% | 92.03% |
| Top 10 | 94.27% | 95.63% | 94.11% |
Supplier dependency
| Particulars | FY 2023-24 | FY 2022-23 | FY 2021-22 |
| Top 1 | 21.72% | 13.46% | 11.10% |
| Top 3 | 43.37% | 36.57% | 28.01% |
| Top 5 | 57.88% | 50.07% | 41.27% |
| Top 10 | 70.91% | 72.91% | 65.98% |
Machinery/Plants/Factory
- Manufacturing plant located in Survey No-48, Wankarner Boudry, Bhalgam, National Highway 8-A, Wankaner, Rajkot, Wankaner, Gujarat-363621, India
Capacity Utilisation
| Particulars | 2024 | 2023 | 2022 |
| Installed Capacity (In MT) | 108000 | 108000 | 108000 |
| Actual Capacity Utilization (In MT) | 85,493 | 93,286 | 93,187 |
| Actual Capacity Utilization (In %) | 86.36% | 86.38% | 86.28% |
Peer companies comparison
| Name of the company | Face Value (₹) | Current Market Price (₹) | EPS (₹)Diluted | P/E Ratio | RoNW (%) | NAV per Equity Share (₹) | Revenue from operations (₹ in Lakhs) |
| Aditya Ultra Steel Limited | 10 | 62 | 4.62 | 13.41 | 16.33% | 28.15 | 58,780.08 |
| Peer Groups | |||||||
| Rathi Bars Limited | 10 | 34.88 | 2.19 | 15.93 | 3.80% | 57.52 | 61,403.52 |
| Mangalam Worldwide Limited | 10 | 130.50 | 7.78 | 16.77 | 11.68% | 66.21 | 81,810.80 |
(₹ in Lakh, except %)
| Particulars | Aditya Ultra Steel Limited | Rathi Bars Limited | Mangalam Worldwide Limited | ||||||
| 31-03-2024 | 31-03-2023 | 31-03-2022 | 31-03-2024 | 31-03-2023 | 31-03-2022 | 31-03-2024 | 31-03-2023 | 31-03-2022 | |
| Revenue from Operations | 58,780.08 | 53,044.78 | 51,535.53 | 61403.52 | 48235.65 | 49384.14 | 81810.8 | 64448.7 | 52302.96 |
| Growth in Revenue from Operations (%) | 10.81 | 2.93 | NA | 27.3 | -2.33 | NA | 26.94 | 23.22 | NA |
| EBITDA | 1801.39 | 986.79 | 1091.53 | 3579.75 | 1496.52 | 1325.49 | 3717.19 | 618.72 | 1151.04 |
| EBITDA Margin (%) | 3.06 | 1.86 | 2.12 | 5.83 | 3.1 | 2.68 | 4.54 | 0.96 | 2.2 |
| Profit After Tax | 792.34 | 277.66 | 488.9 | 1433.37 | 258.39 | 285.36 | 2010.33 | 1668.53 | 1238.58 |
| PAT Margin (%) | 1.35 | 0.52 | 0.95 | 2.33 | 0.54 | 0.58 | 2.46 | 2.59 | 2.37 |
| RoE (%) | 23.92 | 10.18 | 21.33 | 356.82 | 2.9 | 3.3 | 13.37 | 19.17 | 42.49 |
| RoCE (%) | 18.75 | 10.76 | 14.33 | 0.58 | 5.37 | 3.25 | 12.52 | 0.81 | 10.64 |
| Net Fixed Asset Turnover | 18.35 | 16.9 | 14.52 | 3.87 | 9.74 | 6.42 | 33.71 | 13.01 | 6.8 |
| Net Working Capital Days | 16 | 11 | 12 | 5.93 | 47 | 41 | 41 | 34 | -4 |
| Operating Cash Flows | 912.59 | 841.14 | -618.2 | 13.12 | 301.83 | -935.87 | -1124.92 | 301.48 | -311.78 |
Group companies
- VMS Industries Limited
- VMS TMT Limited
SWOT ANALYSIS
- Strengths
- Experienced Promoters;
- Cordial relations with customers;
- Established Brand;
- Strategic location of Manufacturing facility;
- Quality control is highest priority.
- Good Distribution and Dealer Network
- Weaknesses
- Intense competition from several unorganized players;
- Demand of TMT bars depends on infrastructure growth and economic growth;
- No Control on price fluctuations of raw material.
- High Capital Intensity Business
- Compliance with Environmental Regulations
- Shortage of Skilled Labour
- Opportunities
- Growing domestic market;
- Huge Infrastructure demand;
- Technological Innovation;
- Sustainable Practices
- Threats
- No Entry Barrier;
- Regulatory Changes:
- Economic Uncertainty:
Business risk factors
- Business of Company is dependent on Kamdhenu Brand.
- Almost entire operations of Company are limited in the state of Gujarat. Any adverse development affecting our operations in this region could have an adverse impact on our business, financial condition and results of operations.
- Company is dependent on few numbers of customers for sales. Loss of any of this large customer may affect our revenues and profitability.
- top ten customers contribute 94.27%, 95.63% and 94.11% of our total sales for the year ended on March 31, 2024, March 31, 2023 and March 31, 2022 respectively.
- Company is dependent on a few suppliers for purchase of product. Loss of any of these large suppliers may affect our business operations.
- top ten suppliers contribute 70.91%, 72.91% and 65.98% of our total purchases for the year ended on March 31, 2024, March 31, 2023 and March 31, 2022 respectively.
- Company is dependent on third party manufacturer for manufacturing of TMT Bars.
- At Present we are operating at 86% of our installed capacity (which is a practical capacity of our manufacturing plant) of our manufacturing plant. In order to cater to increased demand, we have entered into agreement with Maheshvar Ispat Private Limited for manufacturing of TMT Bars.
- The steel industry is highly cyclical and adverse variation in steel prices may have an adverse effect on the Company’s results of operations and financial condition.
Financials
Key Financial Ratios
| Ratios | 2024 | 2023 | 2022 |
| Current Ratio | 1.28 | 1.32 | 1.35 |
| Debt-Equity Ratio | 1.44 | 1.74 | 1.81 |
| Debt Service Coverage Ratio | 2.25 | 1.44 | 2.72 |
| Return on Equity Ratio | 23.92 % | 10.18 % | 21.33 % |
| Inventory Turnover Ratio | 9.72 | 10.32 | 13.43 |
| Trade Receivables turnover ratio | 20.34 | 58.1 | 89.65 |
| Trade Payables turnover ratio | 36.01 | 217.82 | 227.37 |
| Net Capital turnover ratio | 28.82 | 33.58 | 42.64 |
| Net Profit Ratio | 1.35% | 0.52% | 0.95% |
| Return on Capital Employed | 19.62 % | 10.81 % | 15.27 % |
| Gross Profit Ratio | 6.55% | 5.73% | 6.00% |
Key Performance Indicators
(₹ in Lakh, except %)
| Particulars | 2024 | 2023 | 2022 |
| Revenue from Operations | 58,780.08 | 53,044.78 | 51,535.53 |
| Growth in Revenue from Operations (%) | 10.81 | 2.93 | NA |
| EBITDA | 1801.39 | 986.79 | 1091.53 |
| EBITDA Margin (%) | 3.06 | 1.86 | 2.12 |
| Profit After Tax | 792.34 | 277.66 | 488.90 |
| PAT Margin (%) | 1.35 | 0.52 | 0.95 |
| RoE (%) | 23.92 | 10.18 | 21.33 |
| RoCE (%) | 18.75 | 10.76 | 14.33 |
| Net Fixed Asset Turnover | 18.35 | 16.90 | 14.52 |
| Net Working Capital Days | 16 | 11 | 12 |
| Operating Cash Flows | 912.59 | 841.14 | (618.20) |
Assets & Liabilities
(₹ in Lakh)
| Particulars | 2024 | 2023 | 2022 |
| EQUITY AND LIABILITIES | |||
| Shareholders’ Funds | 4,852.16 | 3,959.81 | 3,682.15 |
| Non-Current Liabilities | 915.84 | 780.03 | 1,037.93 |
| Current Liabilities | 8,984.32 | 4,994.81 | 4,436.54 |
| T O T A L | 14,752.33 | 9,734.65 | 9,156.62 |
| ASSETS | |||
| Non-Current Assets | 3,287.48 | 3,141.63 | 3,158.61 |
| Current Assets | 11,464.85 | 6,593.02 | 5,998.01 |
| T O T A L | 14,752.33 | 9,734.65 | 9,156.62 |
Profit & Loss
(₹ in Lakh, except %)
| Particulars | 2024 | 2023 | 2022 |
| Revenue from Operations (₹ in Lakhs) | 58,780.08 | 53,044.78 | 51,535.53 |
| Growth in Revenue from Operations (%) | 10.81 | 2.93 | NA |
| EBITDA (₹ in Lakhs) | 1801.39 | 986.79 | 1091.53 |
| EBITDA Margin (%) | 3.06 | 1.86 | 2.12 |
| Profit After Tax (₹ in Lakhs) | 792.34 | 277.66 | 488.90 |
| PAT Margin (%) | 1.35 | 0.52 | 0.95 |
Cash Flow
(₹ in Lakh)
| Particulars | 2023-24 | 2022-23 | 2021-22 |
| Net cash generated from / (used in) Operating activities | 912.59 | 841.14 | (618.20) |
| Net cash generated from / (used in) Investing activities | (238.24) | (131.58) | (22.28) |
| Net cash generated from / (used in) from Financingactivities | (317.66) | (712.56) | (316.29) |
| Net Increase / (decrease) in Cash & Cash Equivalents | 356.69 | (3.00) | (956.77) |
| Cash and cash equivalents at the beginning of the year | 18.08 | 21.09 | 977.86 |
| Cash and cash equivalents at the end of the year | 374.78 | 18.08 | 21.09 |
Capital structure
(₹ in Lakh, except %)
| Particulars | Pre issue |
| Debts | |
| Long Term Debt | 651.46 |
| Short Term Debt | 4,775.61 |
| Total Debt | 5,427.07 |
| Equity Shareholders Funds | |
| Equity Share Capital | 1,723.56 |
| Reserves and Surplus | 2,034.65 |
| Total Equity | 3758.21 |
| Long Term Debt/ Equity Ratio | 0.17 |
| Total Debt/ Equity Ratio | 1.44 |
IPO Details
Aditya Ultra Steel IPO Details
| Feature | Details |
|---|---|
| IPO Type | Book Built Issue |
| Issue Size | ₹45.88 Crores (Fresh Issue) |
| Price Band | ₹59 – ₹62 per share |
| Face Value | ₹10 per share |
| Minimum Order Quantity | 2000 shares |
| Open Date | September 9, 2024 |
| Close Date | September 11, 2024 |
| Listing Date | September 16, 2024 (Tentative) |
| Listing Exchange | NSE SME |
Object of the issue
| Particulars | Amount (₹ in Lakhs) |
| Capital Expenditure | 1,535.00 |
| To meet Working Capital requirements | 1,500.00 |
| General Corporate Purpose | [●] |
Litigation involved
Gray Market Premium
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