VMS TMT Q4 FY26 Net Profit INR2.29 Crores

Q4 FY26 Performance:

Full Year FY26 Performance:

Billet Manufacturing Facility Benefits:

The company has achieved full integration with its Continuous Casting Machine (CCM) plant and hot charging technology.
Previously purchased billets at INR 42,000 per ton; now procures scrap at approximately INR 35,000 per ton.
Eliminated reheating cost of INR 1,500 to INR 2,000 per ton.
Realized margin improvement of INR 1,000 to INR 1,500 per ton.
Company is now completely dependent on internal billet production from scrap procurement; zero external billet procurement.

Captive Solar Power Project:

15 MW capacity project with estimated cost of INR 45-50 crores.
Commissioning timeline: 12 MW expected in June 2026; remaining 3 MW within two months thereafter (by August 2026).
Expected savings: INR 3 per unit on power bill.
Annual financial savings: Approximately INR 5 crores for the full 15 MW capacity.
All necessary government permissions and procedures have been completed; project is under execution with no regulatory challenges.

Capacity & Utilization:

Installed capacity permission: 3 lakh tons for TMT bars and billets (environment clearance obtained).
Current capacity utilization: 70-75% for both billet plant and TMT manufacturing facility.
Plant is set up on 15-20 acres of land in Gujarat with sufficient space available for future expansion.
No immediate capacity expansion plans; focus is on optimizing current production and sales capacity.

Market Presence & Distribution:

Operates exclusively in Gujarat market.
Sells products under Kamdhenu brand with premium of approximately INR 1,500 per ton over regional brands.
Distribution network: 3 distributors (region-wise in Gujarat) and 227+ dealers.
Dealers are typically small players in talukas and villages, served with orders of 3-10 tons.
Company maintains fleet of 50 trucks for 24-hour supply logistics.
Regular dealer appointment based on district demand assessment.

Market Dynamics:

Gujarat market size: 4.5-5 lakh tons of TMT sold annually.
Company's current monthly sales: 15,000 tons.
Positive demand outlook driven by infrastructure push, housing sectors, and upcoming Commonwealth Games 2030.
Gujarat government recently permitted 60-floor high-rise buildings, increasing TMT demand.
Potential additional demand from Gujarat's bid for 2036 Olympics.

Pricing & Commodity Risk:

TMT bars are commodity products with daily price fluctuations.
Company maintains conversion margin stability by covering raw material (scrap) procurement on the same day as TMT sales.
Recent price reduction in finished products was matched by corresponding reduction in scrap prices.
West Asia war caused some supply disruptions but company maintained control over raw material procurement.

Debt Reduction:

Company paid off significant borrowings in the previous year, reducing interest costs.
Improved Return on Equity (ROE) and Return on Capital Employed (ROCE) as a result.

Future Growth & Capex:

Growth primarily driven by operational efficiencies, full integration benefits, and solar power savings.
Any future expansion would be funded through internal accruals and executed within existing premises.
No specific capital expenditure plans announced for FY27.

Working Capital: