About VMS TMT Limited – Mainboard IPO
VMS TMT Limited is a manufacturer of thermo mechanically treated (TMT) bars based in Gujarat, India. The company produces and sells TMT bars primarily for the construction and infrastructure sectors. Established in 2013, VMS TMT operates manufacturing facilities that deliver products meeting industry standards, catering mainly to customers in Western India.
READ DRHP HERE: SEBI|DRHP|VMS TMT|
IPO Details
| Key Points | Information |
|---|---|
| IPO Price Band | ₹94 – ₹99 per share |
| Minimum Lot Size | 150 shares (about ₹14,850 at highest price) |
| Issue Size | ₹148.50 crore (100% fresh issue) |
| Face Value | ₹10 per share |
| Stock Exchanges | BSE and NSE (Mainboard IPO) |
| Registrar | Kfin Technologies Limited CLICK HERE |
| Book-running Managers | Arihant Capital Markets Ltd. |
| Offer Structure | Fresh issue only |
IPO Timeline (Important Dates)
| Event | Date |
|---|---|
| IPO Opens | 17th September 2025 |
| IPO Closes | 19th September 2025 |
| Allotment Date | 22nd September 2025 |
| Refunds/Unsuccessful Bids | 23rd September 2025 |
| Shares in Demat Account | 23rd September 2025 |
| Listing Date | 24th September 2025 |
What Is the Money Used For?
- The proceeds from the IPO will primarily be used for repayment or prepayment, either full or partial, of certain borrowings availed by the company amounting to ₹115 crore.
- The balance will be used for general corporate purposes.
Key Financials (as per RHP and Public Prospectus)
| Financial Metric | FY23 (₹ Cr) | FY24 (₹ Cr) | FY25 (₹ Cr) |
|---|---|---|---|
| Revenue from Operations | 882.06 | 873.17 | 771.41 |
| EBITDA (Profit from Operations) | 21.91 | 41.20 | 45.53 |
| EBITDA Margin (%) | 2.48% | 4.72% | 5.91% |
| Profit After Tax (PAT) | 4.20 | 13.47 | 14.74 |
| PAT Margin (%) | 0.48% | 1.54% | 1.91% |
| Return on Capital Employed (ROCE) | 10.94% | 16.70% | 12.79% |
| Debt to Equity Ratio | 5.28 | 4.25 | 3.77 |
Explanation of Financial Terms
- Revenue: Total sales made from business.
- EBITDA: Operating profits before interest, taxes, depreciation, and amortisation.
- PAT: Final profit after tax expense.
- Margins: Profit as percentage of revenue.
- ROCE: Efficiency of capital usage.
- Debt to Equity: Leverage ratio measuring financial risk.
Analysis
- Revenue declined steadily from ₹882.06 crore in FY23 to ₹771.41 crore in FY25, impacted by market conditions.
- EBITDA has grown significantly, reflecting improved operational efficiency and cost control.
- Profit after tax increased sharply from ₹4.20 crore to ₹14.74 crore, aided by better margins.
- The company has been reducing debt levels, with debt to equity ratio falling from 5.28 in FY23 to 3.77 in FY25, though leverage remains high.
Why Some Investors Like This Mainboard IPO
- Leading regional player in TMT bars, a critical product for construction and infrastructure sectors.
- Strong EBITDA margin improvement signaling operational efficiencies.
- Proceeds used to deleverage the balance sheet improving financial stability.
- Experienced management and expanding customer base across western India.
- Mainboard listing ensures better liquidity and investor participation.
Points That Need Caution
- Declining revenue trends raise concerns about demand sustainability and pricing pressures.
- High debt levels result in financial risk and interest burden.
- PAT margins remain modest, limiting cash flow generation.
- Heavy competition from large established steel producers.
- Vulnerability to raw material price volatility like scrap and steel billets.
IPO FAQS
What is an IPO?
- An IPO (Initial Public Offering) is when a private company sells its shares to the public for the first time to raise money.
- Example: If a well-known pizza company wants to grow, it can list its shares on the stock exchange so anyone can buy a piece of the company.
How can you apply for an IPO (using Zerodha or Upstox)?
- Make sure you have a Demat account and your bank account is linked.
- Steps:
- Log in to your broker’s app (e.g., Zerodha Kite, Upstox).
- Go to the IPO section.
- Select the company’s IPO you want to apply for.
- Enter how many shares (or ‘lots’) you want and the price you wish to bid.
- Enter your UPI ID, submit your application, and approve the UPI payment request.
How are IPO shares allotted?
- If more people want shares than are available, the company uses a lottery system to decide who gets them.
- If you don’t get shares, your money is simply returned.
What is GMP (Grey Market Premium)?
- GMP shows the extra price people are willing to pay for IPO shares before they officially start trading.
- Example: If IPO price is ₹100 and GMP is ₹20, people are unofficially ready to pay ₹120. It hints at the IPO’s popularity but isn’t a guarantee.
Where to check upcoming IPOs (IPO calendar)?
- Visit popular finance sites like Chittorgarh, IPOWatch, or official exchange websites (NSE, BSE) and look for the “Upcoming IPO” section.
What are IPO listing gains?
- If the share’s price rises on the first trading day, you can make instant profit.
- Example: You buy at ₹150, and it opens at ₹200, you gain ₹50 per share.
How can you make profit from an IPO?
- Quick gains on listing day (if the stock price goes up).
- Long-term: If the company grows, the share price could increase further.
Which IPO is best to buy?
- There is no single best IPO. Check the company’s background, current demand, and GMP, but always research before investing.
- High GMP or popularity doesn’t guarantee profits.
Are IPOs safe?
- IPOs can be profitable but also risky; prices can go up or down sharply.
- Only invest if you are ready for potential losses.
How to check IPO allotment status?
- After the IPO process, check on exchanges (BSE/NSE websites) or the IPO registrar’s site (like K-Fintech, Bigshare,or mufg-intime) by entering your PAN or application number to see if you got shares.
Important Tips for Retail Investors Applying for an IPO
- Use Only Your Own PAN Card:
Avoid using the same PAN card for multiple IPO applications. For example, if you have already applied using your PAN for one IPO, don’t try to apply again with the same PAN under different accounts or through others. - Apply in the Right Category:
Ensure you select the correct investor category (such as Retail Individual Investor) when filling out your application. Applying under a wrong category can lead to rejection or disqualification. - Maintain Sufficient Bank Balance:
Before applying, ensure your bank account linked to the application has enough funds to cover the full bid amount. For instance, if the IPO application requires a payment of ₹15000, make sure your account holds at least that amount. - Use Your Own Bank Account:
Always apply through your own bank account. Using someone else’s account can cause your application to be rejected during the verification process. - Avoid Last-Minute Applications:
Don’t wait until the deadline day or moments before to apply. Last-minute submissions may face technical glitches or processing delays, reducing the chances of success.