Vibhor Steel Tubes Ltd (VSTL) has announced plans to establish a new facility in Sundargarh, Odisha, aiming to elevate its overall manufacturing capacity to 3.41 lakh tonnes. Presently, the steel manufacturer, headquartered in Hisar, operates two existing plants: one situated in Mahabubnagar, Telangana, and the other in Raigad, Maharashtra. These existing facilities collectively contribute to a total installed capacity of 2.21 lakh tonnes.
Vibhor Steel Tubes Ltd is one of the leading manufacturer and supplier of high-quality steel tubes and pipes. Specializing in seamless and welded products, the company serves diverse industries such as construction, infrastructure, automotive, and more. With a commitment to superior quality, innovation, and customer satisfaction, Vibhor Steel Tubes Ltd leverages state-of-the-art manufacturing processes and stringent quality control measures.
Vijay Kaushik, the chairman, shared with reporters that the commissioning of the third project in Odisha will bolster our capacity by 120,000 metric tons to reach 341,000 metric tons. When asked about the project’s timeline, he expressed the goal of making the plant operational within the first quarter of the fiscal year 2024-25. Regarding the expansion initiative, Kaushik mentioned that the company has secured the necessary land and placed orders for plant and machinery, with funding to come from internal accruals.
However, he refrained from disclosing investment details due to regulatory obligations arising from the company’s impending listing on BSE and NSE. The Initial Public Offering (IPO) of Vibhor Steel Tubes is scheduled to open on February 13 and close on February 15. The company has set a price range of Rs 141-151 per share for its proposed IPO. It plans to issue fresh equity shares, each with a face value of Rs 10, aggregating to an issue size of up to Rs 72.17 crore, through the book-building route.
Khambatta Securities is acting as the sole book-running lead manager for the offer, while KFIN Technologies will serve as the registrar. The proceeds from the IPO will be directed towards meeting working capital requirements. VSTL specializes in manufacturing steel products, including electric resistance welded pipes, hot-dipped galvanized pipes, and hollow section pipes. The upcoming plant will focus on producing value-added items such as crash barriers and monopoles, which are expected to enhance profit margins.
Additionally, the company aims to explore export markets once the new production facility becomes operational, leveraging its proximity to raw material sources to reduce freight costs after completing the current expansion plan. Kaushik also noted the renewal of the agreement with Jindal Pipes, effective from April 1, 2023, to manufacture and supply finished goods under the Jindal Star brand. This agreement is initially set for six years and can be extended further based on mutual agreement between the parties involved.