India’s steel industry is at the center of the nation’s infrastructure and housing boom, with reinforcement steel playing a pivotal role in everything from highways and bridges to residential projects. Against this backdrop, VMS TMT is stepping into the capital markets with its maiden IPO, offering investors a chance to participate in the growth story of a Gujarat-based manufacturer of Thermo Mechanically Treated (TMT) bars.
With an annual rolling capacity of 2,00,000 MT, a Kamdhenu brand association, and a network of 227 dealers and 3 distributors, the company has built a strong regional presence. Its strategy of backward integration and cost efficiency has already translated into steadily improving margins and returns.
The IPO, priced between INR 94–99 per share, with a fresh issue size of INR 148.5 crore, is set to open between September 17–19, 2025. But beyond dates and numbers, the more meaningful question for investors is: how does VMS TMT stack up against its listed peers in terms of performance, efficiency, and valuations?
VMS TMT vs Peers: Operating Performance Comparison
An analysis of FY25 results reveals clear differences across industry peers:
| Company | Total Income | EBITDA Margin (%) | PAT Margin (%) |
|---|---|---|---|
| VMS TMT | 771.41 | 5.91 | 1.91 |
| Kamdhenu | 757.95 | 10.09 | 8.03 |
| Vraj Iron & Steel | 478.86 | 13.10 | 8.74 |
| BMW Industries | 566.43 | 21.23 | 11.23 |
| Electrotherm (India) | 4,122.92 | 11.63 | 10.40 |
At first glance, peers such as BMW and Kamdhenu appear stronger on absolute margins. However, VMS TMT’s story lies in its trajectory rather than static numbers. Over three years, margins have expanded from 0.48% in FY23 to 4.04% in Q1 FY26—a multi-fold improvement unmatched by peers during the same period.
- Kamdhenu benefits from a franchise-driven model but has struggled with flat revenues in recent years.
- Vraj Iron & Steel and BMW Industries deliver higher margins, yet their returns on equity and growth consistency lag.
- Electrotherm, with its massive turnover, dominates in scale but remains volatile in profitability.
- VMS TMT, though smaller in size, combines rising efficiency with improving profitability, showcasing a disciplined growth story.
Investor takeaway: Peers may lead on current margin levels, but VMS TMT’s consistent margin expansion and operational efficiency highlight a company on an improving growth curve—an attribute highly valued by long-term investors.
VMS TMT Peer Comparison: The Efficiency Lens
Return ratios offer perhaps the clearest lens into efficiency, and this is where VMS TMT shines:
| Company | RoNW (%) | RoCE (%) |
|---|---|---|
| VMS TMT | 20.14 | 12.79 |
| Kamdhenu | 18.82 | 24.56 |
| Vraj Iron & Steel | 10.88 | 16.98 |
| BMW Industries | 9.16 | 9.95 |
| Electrotherm (India) | (377.85) | 43.01 |
- VMS TMT leads the peer set with the highest RoNW at 20.14%, reflecting superior shareholder value creation relative to its scale.
- Kamdhenu is robust on both RoNW (18.82%) and RoCE (24.56%), but with less visible growth momentum.
- Vraj and BMW generate moderate returns, while Electrotherm’s RoCE at 43% is eye-catching but distorted by its negative net worth.
VMS’ RoNW leadership is significant—it shows that every rupee of equity generates stronger returns for shareholders compared to most peers. While others may post higher margins or larger revenues, VMS TMT demonstrates the rare ability to combine profitability with efficient capital use, making it one of the more sustainable stories among mid-sized steel players.
VMS TMT Peer Comparison Analysis (Part 2)
Valuation Ratios – The Investor’s Lens
Beyond operating performance, valuation ratios provide a window into how the market perceives each company. Here’s how VMS compares with peers on key metrics:
| Company | P/E | P/B | P/S | Current Ratio | D/E |
|---|---|---|---|---|---|
| VMS TMT | 33.33 | 7.43 | 2.32 | 1.14 | 3.77 |
| Kamdhenu | 12.4 | 2.57 | 1.09 | 2.94 | 0.00 |
| Vraj Iron & Steel | 14.2 | 1.31 | 1.03 | 10.6 | 0.01 |
| BMW Industries | 18.9 | 1.58 | 2.01 | 1.98 | 0.18 |
| Electrotherm (India) | 5.19 | NA | 0.32 | 0.66 | NA |
- Kamdhenu and Vraj look cheaper on paper, but their muted sales growth and slower earnings expansion partly justify the discount.
- BMW Industries sits in the mid-range, balancing moderate growth with reasonable multiples.
- Electrotherm, with its negative book value, trades at a deep discount, reflecting structural risks.
While the company’s premium highlights the company’s improving trajectory, high RoNW, and deleveraging plans suggest the market is pricing in future growth rather than past numbers.
Balance Sheet & Liquidity Comparison
Capital structure is often the hidden variable in long-term performance.
- The company’s Debt-to-Equity of 3.77 highlights its growth phase, and with INR 115 crore from the IPO earmarked for repayment, leverage will drop sharply post-listing—strengthening the balance sheet and creating room for future growth.
- Kamdhenu and Vraj boast virtually debt-free balance sheets, but their growth scale has been more measured.
- BMW Industries maintains conservative leverage (D/E 0.18), while Electrotherm continues to wrestle with debt and a negative equity base.
- On liquidity, Vraj Iron & Steel’s very high current ratio (10.6) signals surplus working capital, while VMS TMT’s 1.14 is lean but sufficient for operational needs.
While peers may appear safer on debt metrics, VMS TMT’s clear roadmap for deleveraging through IPO proceeds is a positive differentiator. Investors are essentially buying into a company that is actively strengthening its balance sheet, a forward-looking move many peers have already exhausted.
Positioning VMS TMT Among Peers
When placed alongside peers, VMS TMT offers a compelling mix of growth, efficiency, and improvement potential:
- Margins: VMS TMT has demonstrated unmatched consistency in margin expansion.
- Returns: With the highest RoNW (20.14%) among comparable peers, the company stands out as a strong value creator.
- Valuation: Premium multiples reflect investor confidence in VMS TMT’s trajectory rather than static numbers.
- Balance Sheet: Higher leverage is being addressed head-on, signaling prudent capital management.
“In a sector where scale and margins often dominate headlines, VMS TMT distinguishes itself by delivering shareholder returns and a clear path to deleveraging. The IPO premium is not without reason—it mirrors the company’s steady operational gains and disciplined financial strategy. For investors looking to tap into India’s construction-driven steel demand, VMS TMT offers a growth-focused yet improving story, one that balances ambition with responsibility.”