💰 Financial Performance

Revenue Growth by Segment

Total revenue from operations was INR 265.63 Cr in FY25, representing a decline of 13.74% compared to INR 307.93 Cr in FY24. For H1 FY26, revenue stood at INR 109.15 Cr, a 20.5% decrease from INR 137.35 Cr in H1 FY25, primarily due to a strategic shift from high-volume trading to value-added manufacturing.

Geographic Revenue Split

The company is primarily based in Rajkot, Gujarat. Specific percentage splits for other regions are not disclosed in the available documents.

Profitability Margins

Net Profit Margin improved to 0.80% in FY25 from 0.43% in FY24. For H1 FY26, the company reported a Net Profit of INR 2.87 Cr, a significant increase of 118% compared to INR 1.31 Cr in H1 FY25, driven by higher-margin value-added services.

EBITDA Margin

EBITDA margin improved to 2.67% in FY25 from 2.46% in FY24. This 21 basis point improvement occurred despite a revenue decline, as the company shifted focus toward premium products and manufacturing.

Capital Expenditure

The company utilized IPO proceeds of INR 16.05 Cr for setting up a cutting and slitting plant. Additionally, INR 39.65 Cr was raised via preferential issue in September 2025 for working capital and general corporate purposes.

Credit Rating & Borrowing

Infomerics Ratings assigned a long-term rating of 'IVR BB+/Stable' for bank facilities totaling INR 77.60 Cr. Borrowing costs include interest on loans which amounted to INR 3.00 Cr in H1 FY26.

⚙️ Operational Drivers

Raw Materials

Key raw materials include HR Coils, HR Plates, CR Coils, GP(GI) Coils, and BGL Coils. These materials are essential for the new cutting and slitting manufacturing plant which became fully functional in April 2025.

Import Sources

Not disclosed in available documents; however, the company operates out of Rajkot, Gujarat, suggesting significant local sourcing or domestic procurement.

Capacity Expansion

The company transitioned from a pure trading model to manufacturing by installing a cutting and slitting plant that became fully functional in April 2025. This forward integration allows for value-added processing of steel coils.

Raw Material Costs

Cost of materials consumed in H1 FY26 was INR 72.26 Cr, representing approximately 66% of total revenue. This reflects the shift toward manufacturing compared to the previous year where 'Purchase of Stock-in-trade' was the primary cost driver.

Manufacturing Efficiency

The company is moving toward value-added manufacturing to improve margins. Efficiency is monitored through the successful deployment of IPO funds into the new slitting and cutting facility.

📈 Strategic Growth

Growth Strategy

Growth is targeted through forward integration by moving from trading ERW tubes to manufacturing and value-added services (cutting and slitting of HR Coils/Plates). The company also incorporated a new subsidiary, VRV Techsol Limited, on September 30, 2025, to expand its business footprint.

Products & Services

Round pipes, square pipes, rectangle pipes, structural steels, BGL coils, GP(GI) coils, HR coils, CR coils, color coated coils, MS sheets, and value-added cutting and slitting services.

Brand Portfolio

Visaman.

New Products/Services

Value-added services including precision cutting and slitting of steel coils, which contributed to the margin expansion seen in H1 FY26.

Market Expansion

The company is expanding its corporate presence, evidenced by shifting its registered office to a larger facility at Wings Business Bay, Rajkot, in November 2025.

🌍 External Factors

Industry Trends

The industry is shifting toward value-added steel processing. VGSL is positioning itself by moving away from pure trading of ERW tubes toward specialized slitting and cutting of HR/CR coils to capture higher industrial margins.

Competitive Landscape

Operates in an intensely competitive and fragmented steel trading and processing market with numerous regional players.

Competitive Moat

The moat is built on the 15+ years of experience of the promoters (Mr. Sureshchandra Vasa and family) and a long-standing track record since 2019, which helps in navigating economic cycles and maintaining supplier relationships.

Macro Economic Sensitivity

Highly sensitive to steel price cycles and industrial demand in the construction and infrastructure sectors.

Consumer Behavior

Industrial consumers are increasingly demanding customized steel sizes, driving the need for the company's new slitting and cutting services.

Geopolitical Risks

Exposed to global steel price fluctuations and government regulations regarding steel imports/exports.

⚖️ Regulatory & Governance

Industry Regulations

Subject to extensive government regulations and statutory licenses required for manufacturing and trading steel products.

Environmental Compliance

The company is subject to environmental, health, and safety laws; failure to maintain these licenses could adversely affect operations.

Taxation Policy Impact

Current tax expense for H1 FY26 was INR 0.97 Cr. The company follows Indian GAAP and is exempt from Ind AS as an SME-listed entity.

⚠️ Risk Analysis

Key Uncertainties

The primary uncertainty is the volatility of steel prices and the elongated working capital cycle, which stood at 80 days in FY25, potentially straining liquidity.

Geographic Concentration Risk

High concentration in Rajkot, Gujarat, where the registered office and manufacturing facilities are located.

Third Party Dependencies

Dependent on steel mills for the supply of HR and CR coils.

Technology Obsolescence Risk

The company is mitigating technology risk by upgrading from trading to modern cutting and slitting machinery.

Credit & Counterparty Risk

Average collection period increased to 49 days in FY25 from 36 days in FY24, indicating a moderate increase in counterparty credit risk.