Avtar Steel IPO

Strengths · 8

• 01Revenue from operations rose from Rs 1,102.64 crore in FY2024 to Rs 1,263.34 crore in FY2026, while EBITDA rose from Rs 51.25 crore to Rs 112.99 crore.
• 02EBITDA margin was 8.94% in FY2026 against 4.65% in FY2024, and PAT margin was 3.33% in FY2025 and 4.68% in FY2026.
• 03Sales volume grew 19.03% to 69,515.83 metric tonnes in FY2026 after growing 19.25% in FY2025.
• 04The company makes over 150 grades of stainless-steel long and wire products, so no single product gave more than 29.66% of FY2026 revenue from operations.
• 05Top five customers gave 31.23% of FY2026 revenue from operations and the top customer gave 9.06%.
• 06Operating cash flow turned positive at Rs 53.71 crore in FY2026 after negative figures in FY2025 and FY2024.
• 07Debt to equity fell from 2.81 times in FY2024 to 1.71 times in FY2026 and debt to EBITDA fell from 5.17 times to 2.97 times.
• 08Return on equity was 35.49% and return on capital employed was 20.74% in FY2026.

Risks · 10

• 01All three plants are in one district of Haryana, so a shutdown or local disruption would hit the whole business.
• 02Total borrowings were Rs 335.35 crore as of FY2026 against a net worth of Rs 194.55 crore, and debt to equity was 1.71 times.
• 03Operating cash flow was negative in FY2025 at Rs -3.17 crore and in FY2024 at Rs -27.41 crore, and the company says this may recur.
• 04Working capital is heavy: inventory days rose from 81 in FY2024 to 129 in FY2026 and the cash conversion cycle rose from 58 days to 98 days.
• 05The company has no long-term contracts with its key customers, and the top five customers gave 31.23% of FY2026 revenue from operations.
• 06Raw materials such as stainless-steel scrap, nickel, chrome and molybdenum are exposed to price swings and supply shortfalls.
• 07Part of the offer is a sale by the promoter: Sumit Jindal sells up to 50,00,000 shares, so that money goes to him and not to the company.
• 08The fresh issue has Rs 200.00 crore for debt repayment and an amount for general corporate purposes that is not yet stated, capped at 25% of gross proceeds.
• 09Litigation against the company includes 11 tax proceedings and 2 statutory or regulatory proceedings with Rs 14.82 crore involved, to the extent quantifiable.
• 10Some corporate records and filings with the RoC are not traceable, and the auditors have included emphasis of matter remarks in the restated financials.

Avtar Steel Limited makes stainless-steel long and wire products of special grades. It works on a make-to-order model and customises products for each buyer. As of 31 July 2026 it makes over 150 grades. The products are used in automobile, oil and gas, defence, aerospace, water solutions, energy, shipping, construction, chemical, food and dairy industries.

The product range has five parts: blocks and blooms, hot rolled annealed and pickled (HRAP) black bars and bright bars, HRAP wire rods, profiles such as angle, hexagonal, channel and square bars, and wires. In FY2026 blocks and blooms gave Rs 374.72 crore (29.66% of revenue from operations) and HRAP black bars and bright bars gave Rs 371.79 crore (29.43%). HRAP wire rods gave Rs 253.17 crore (20.04%) and stainless-steel wires gave Rs 164.48 crore (13.02%). Wires had almost no sales in FY2025.

The company sells to businesses, mainly manufacturers. Named customers include Bansal Wire Industries Limited, Goodluck India Limited, Stellaris Specialities India Limited, Vividh Wires Limited, Ivy Creations UK Limited, Goodluck Defense and Aerospace Limited and Victura Technologies Private Limited. India gave 94.48% of FY2026 revenue from operations, mainly from north and west India. Haryana was the largest state at 24.65%, followed by Uttar Pradesh at 17.68% and Rajasthan at 14.60%. Exports gave 5.40% and went mainly to South Korea, the United Kingdom, Italy, Turkey and Vietnam.

As on 31 March 2026 the company runs three manufacturing facilities across 33.54 acres in Sonipat, Haryana. The steel melting shop has an installed capacity of 72,000 MTPA and the wire rod and bar division has 120,000 MTPA. The hot rolling and cold finishing facility has 24,000 MTPA. The plants have an electric induction furnace, an Argon Oxygen Decarburization vessel, a continuous casting machine, hot rolling mills, heat treatment and a bright bar facility. Sales volume was 69,515.83 metric tonnes in FY2026.

The company says it has over three decades of operational history. Sumit Jindal, the Chairman and Managing Director, has been with the company since 15 February 2007. The company plans a new Specialty Steel Melting Division and a move into aluminium wire rods.

The industry

India's stainless-steel market is projected to grow at a CAGR of 8.2% over FY26 to FY30 and reach about Rs 1,704 billion by FY30, according to the CARE Report cited in the document. The report names infrastructure investment, green hydrogen, smart urban infrastructure, renewable energy installations and tunnel construction as drivers. It also expects India's per capita stainless-steel consumption to move towards global averages.

Customer concentration: Top 5 customers gave 31.23% of FY2026 revenue from operations (34.34% in FY2025 and 29.67% in FY2024); the top customer gave 9.06%.