Infrastructure
We manufacture our TMT Bars at our manufacturing facility in Bhayla Village near Ahmedabad in Gujarat, India. Our billet manufacturing will be at the same facility after our backward integration is complete.
TMT Bar Production
- Coal Oxy automation to maintain proper flow of oxygen for optimum consumption of coal;
- Oil lubrication system at plant eliminating use of grease for better life cycle and lower breakdown;
- Automatic flying shearing, automatic bundling machine, bending machine and cooling bed with layer shifting for better handling;
- Use of tensile metal rolls for better shine, perfect size and higher roll life; and
- The entire mill is automated and synchronized via a unified control panel using a Programmable Logic Controller (PLC), ensuring efficient and consistent production.
Billets Production - Backward Integration
In accordance with our backward integration project, we will manufacture billets for our TMT Bar production. We are installing a thirty-ton induction furnace with installed capacity of 216,000 MT per annum. The production of billets will be for our own captive consumption to manufacture TMT Bars. The length of the billets can be customized as per the specification of TMT bars to be manufactured.
Key features of our billets unit include
- Both our billets unit and TMT Bar unit will be operated and controlled through unified control panel at single location.
- Cast billets will directly go into rolling which is the first stage of TMT Bar production. This will eliminate the reheating of billets, thereby burning loss will be saved.
- Our consumption of coal will be substantially reduced, and scrap melting will be done through the electric induction furnace which was installed in Fiscal 2024. Accordingly, our current price fluctuation risk in coal sourcing will be eliminated.
Raw Materials, Suppliers and Utilities
Our major raw materials for our manufacturing processes are mild steel scrap, sponge iron and coal. Our business is significantly dependent on our supply chain management. We have strong supply chain relationships in Gujarat and certain other states. Our raw material purchases were predominantly from suppliers in Gujarat. In the three months period ended June 30, 2025, Fiscal 2025, Fiscal 2024 and Fiscal 2023, our material purchased from Gujarat was 69.63%, 69.99%, 64.04% and 77.65% respectively.
The table below sets forth our cost of goods sold for periods indicated.
*Consist of raw material consumed, purchase of stock-in trade, changes in inventories and direct expenses
The table below sets forth cost of materials purchased from our top supplier, top three suppliers and top ten suppliers for the periods indicated:
The table below sets forth cost of materials purchased from our top ten suppliers for the periods indicated:
*Names of the suppliers have not been disclosed in this Red Herring Prospectus due to non-receipt of consents from such suppliers.
# Our company has purchased scrap from these suppliers in the three months period ended June 30,2025
$ Our company has purchased billets from these suppliers in the three months period ended June 30,2025
The table below sets forth percentage break up of our material purchases for the periods indicated: (figures in %)
*Negligible
We usually do not enter into long-term supply contracts with our raw material suppliers and typically source raw materials on a purchase order basis. The terms and conditions of these purchase orders contain provisions related to the supplier’s product quantity, pricing, payment and delivery terms. We typically purchase raw materials based on the projected levels of sales, actual sales orders on hand, and the anticipated production requirements, taking into consideration any expected fluctuation in raw material prices and lead time. The prices of our raw materials are based on, or linked to, the international prices of such raw material and the variations are typically passed on to the customer.
Water
Water forms an essential part of our production processes. We consume a substantial amount of water in our operations, which is either sourced from third parties or extracted in the form of ground water.
The table below sets forth our expenses for water for the periods indicated:
Coal
Carbon from coal is a major reducing agent and heat source in the production of TMT Bars. With our new electric induction furnace that was installed as part of our backward integration, we expect that our coal consumption will be substantially reduced.
Carbon from coal is a major reducing agent and heat source to convert scrap to billets and in the production of TMT Bars. In respect of coal, we sourced our requirements from five (5) suppliers in the three months period ended June 30, 2025, eight (8) suppliers in Fiscal 2025, two (2) suppliers in Fiscal 2024 and six (6) suppliers in Fiscal 2023. Natural gas is used to cut billets during production. We source our natural gas locally from third parties in Gujarat.
The prices of our coal are linked to the national and international prices and the variations increase our costs of manufacturing.
The table below sets forth our expenses for coal consumption for the periods indicated:
For our production of TMT Bars from scrap, we use oxygen, LPG, water, power to run our furnaces and equipment and in the production processes itself. Our power requirements are sourced through the local state power grid. We also procure natural gas, LPG and oxygen from local suppliers in the State of Gujarat.
The table below sets forth our expenses for (i) oxygen and LPG and (ii) power, for the periods indicated:
Our power expenses have increased significantly in recent years due primarily to an increase in electricity prices and further increases in power expenses may impact our margins if we are not able to pass these price increases to our customers. We expect our power requirements and power expenses to increase significantly due to the installation of our thirty-ton electric induction furnace as part of our backward integration project.
As part of our strategy, we are planning to setup a 15 MW solar power plant near our manufacturing facility for our captive consumption to reduce our power expenses. For further details, see “Our Business – Our Strategies – Integration to Renewable Energy for Cost Optimization and Sustainability” on page 187 .
Logistics
We transport our finished products by road. We generally sell our TMT Bars on a F.O.R. basis, which means to our customer’s door. In addition, we pay for transportation costs in relation to the delivery of raw materials and other inputs to our manufacturing facility. Our manufacturing facility and over 98.93% and 96.98% of our customers in the three months period ended June 30, 2025 and Fiscal 2025 are located in Gujarat. For further details, see “Our Business - Our Customers” on page 191 .
The following table sets forth our freight and cartage on sales charges and such charges as a percentage of total expenses in the periods indicated:
Inventory Management
We maintain high inventory levels of raw material requirements for the manufacture of our TMT Bars. The inventory of finished products is typically based on a combination of confirmed and expected orders. Our Company maintains sufficient level of inventories for finished goods to ensure the customer demand and timely delivery of TMT Bars to such customers.
The table below sets forth our inventory, average inventory and inventory turnover ratio as at, or for the periods, indicated: (₹ in lakhs, except ratio)
For further information, see “Risk Factors - Our financial performance may be adversely affected if we are not successful in forecasting customer demands, managing our inventory levels. Our inventory turnover ratio has decreased significantly. The inventory turnover ratio for the three months period ended June 30, 2025 and Fiscal 2025, Fiscal 2024 and Fiscal 2023 was 5.45, 6.45, 8.60 and 12.60 respectively” on page 30 .
Health, Safety and Environment
We are subject to national, regional and state laws and government regulations in India relating to safety, health and environmental protection. These laws and regulations impose controls on air and water discharge, noise levels, storage handling, employee exposure to hazardous substances and other aspects of our manufacturing operations. Further, our products, including the process of manufacture, storage and distribution of such products, are subject to numerous laws and regulations in relation to quality, safety and health.
We are committed to maintaining high standards of workplace health and safety. While there have an instance of an accident in the past, however, we aim to become a zero-accident organisation. We believe that accidents and occupational health hazards can be significantly reduced through a systematic analysis and control of risks and by providing appropriate training to our management and our employees. In addition to creating initiatives to improve workplace employee safety, we also implement initiatives to reduce the environmental impact of our operations. As on the date of this Red Herring Prospectus, our manufacturing facility at Bhayla are certified ISO 45001:2018 for occupational health and safety management system standards and ISO 14001:2015 for environmental management system standards.
Health and employee safety
We are committed to maintaining high standards of workplace health and safety, we aim to become a zero-accident organisation. Any mishaps or accidents at our facilities or any emission or leakage from our factory could lead to personal injury, property damage, production loss, adverse publicity and legal claims. We believe that accidents and occupational health hazards can be significantly reduced through a systematic analysis and control of risks and by providing appropriate training to our management and our employees.
We have a safety management system which has been implemented across our manufacturing facilities. We have a safety officer and safety training is carried out jointly with the SKF team every 15 days.
Environment
In addition to creating initiatives to improve workplace employee safety, we also implement initiatives to reduce the environmental impact of our operations.
We are looking to setup a 15 MW solar power plant near our manufacturing facility for our captive consumption to reduce our electricity expenses. For further details, see “Our Strategies –Setting up a 15MW solar plant to reduce power expenses” on page.
Information Technology (IT)
Our IT systems are important to our business. We use Tally, an enterprise resource planning software which is owned by us, for basic business functions and use programmable logic controller (PLC) to manage our business processes, sensors and movement of inventory and enterprise resource planning including anti-virus which our Company have obtained on license basis for data security and protection to cover key areas of our operations and accounting, which we source from third party vendors. For information on the risk to our IT systems, see “Risk Factors - We do not have an information security and disaster recovery system in place. Further any failure or disruption of our IT systems may adversely affect our business, results of operations and financial condition” on page 30 .
Insurance
Our operations are subject to risks inherent as TMT Bar manufacturer, which include liability for product and/or property damage, malfunctions and failures of manufacturing equipment, fire, explosions, loss- in-transit for our products, accidents, personal injury or death, environmental pollution and natural disasters. We maintain insurance coverage that we consider necessary for our business. We maintain an insurance policy that insures against material damage to buildings, facilities and machinery, furniture, fixtures, fittings, stocks, and machinery breakdown. In addition, we maintain commercial general liability insurance that covers liability in claims for bodily injury (and medical payments), property damage, and personal and accidental injury. We, however, have not taken insurance to protect against all risk and liabilities. For example, we do not have key man insurance, and we do not take insurance for potential product liability claims.
The table below sets forth particulars of our insurance coverage on a restated basis as at the dates indicated:
For further information, see “Risk Factors – We may not have sufficient insurance coverage to cover our economic losses as well as certain other risks, not covered in our insurance policies, which could adversely affect business, results of operations and financial condition. The insured assets as a percentage of fixed assets for the three months period ended June 30, 2025 and Fiscal 2025, Fiscal 2024 and Fiscal 2023 was 96.25%, 98.64%, 79.54% and 80.72% respectively” on page 45 .
We believe that our insurance coverage is in accordance with industry custom, including the terms of and the scope of the coverage provided by such insurance. However, our policies are subject to standard limitations, including with respect to the maximum amount that can be claimed.
Human Resources
We place importance on developing our human resources. As of July 31, 2025, our workforce comprised of 230 employees. Combinations of full-time employees gives us flexibility to run our business efficiently.
The table below sets forth the number of our employees as of July 31, 2025:
Our work force is a critical factor in maintaining quality, productivity and safety, which strengthens our competitive position. We are committed to provide safe and healthy working conditions. We currently do not have any registered trade unions.
The table below set forth the attrition rate for our employees for the periods indicated:
For further details, see “Risk Factor - Our success largely depends upon the knowledge and experience of our Promoters, Directors, Key Managerial Personnels and Senior Management Personnels as well as our ability to attract and retain personnel with technical expertise. Our inability to retain our Promoters, Directors, Key Managerial Personnels and Senior Management Personnels or our inability to attract and retain other personnel with technical expertise could adversely affect our business, results of operations and financial condition” on page 46.
We offer formal and informal training as well as on-the-job learning. Our training is carried out at our manufacturing facility to help turn unskilled labour into semi-skilled labour, and semi-skilled labour into skilled labour, thus increasing productivity.
In addition to compensation that includes salary and allowances, our employees receive statutory benefits (including employees provident fund, pension, retirement and other benefits, as applicable) and are covered by group personnel accident.
As on date of this Red Herring Prospectus, our Company has not engaged any contractual workers.
Competition
We have entered into a retail license agreement with Kamdhenu Limited dated November 7, 2022, which allows us to market our TMT Bars under the Kamdhenu Brand. In the three months period ended June 30, 2025, Fiscal 2025, Fiscal 2024 and Fiscal 2023, we paid Kamdhenu Limited a royalty of ₹ 208.57 lakhs, ₹ 654.83 lakhs, ₹ 610.66 lakhs and ₹ 535.45 lakhs, respectively, representing 0.98%, 0.85%, 0.70% and 0.61% of our total revenue from operation for the same respective periods. Our retail licence agreement dated November 7, 2022 is terminable by Kamdhenu Limited by giving one-month advance notice to us without any reason.
We have a pending trademark application for our corporate logo pending with the Trademark Registry on May 30, 2024. The trademark has been approved by the trademark registry and is published in trademark journal for public objection.
We have acquired and developed and continue to acquire and develop knowledge and expertise, or know-how, and trade secrets in our businesses, including know-how and trade secrets related to proprietary technologies and patents, trademarks, know-how and trade secrets. Our know-how and trade secrets in our businesses may not be patentable, however, they are valuable in that they enhance our ability to provide high-quality products to our customers. See “Risk Factors - We have filed a trademark application for our corporate logo. We also rely on a combination of trade secret and contractual restrictions to protect our intellectual property. If we are unable to protect our intellectual property rights, our business, results of operations and financial condition may be adversely affected” on page 53
Intellectual Property Rights
We have a retail licence agreement with Kamdhenu Limited which allows us to market our TMT Bars exclusively in Gujarat (except Kutch and Saurashtra) under the brand “Kamdhenu NXT”. In Fiscal 2024, Fiscal 2023 and Fiscal 2022, we paid Kamdhenu Limited their royalty from our total revenue from operation for the same respective periods. Our retail license agreement is terminable by Kamdhenu Limited by giving one-month advance notice to us without any cost or reason.
We have acquired and developed and continue to acquire and develop knowledge and expertise, or know-how, and trade secrets in our businesses, including know-how and trade secrets related to proprietary technologies and patents, trademarks, know-how and trade secrets. Our know-how and trade secrets in our businesses may not be patentable, however, they are valuable in that they enhance our ability to provide high-quality products to our customers.We have a trademark application pending for our corporate logo. We also rely on a combination of trade secret and contractual restrictions to protect our intellectual property. If we are unable to protect our intellectual property rights, our business, results of operations and financial condition may be adversely affected.