German Green Steel IPO Review – Well-Informed Investors Can Park Funds for Medium to Long Term Rewards
Issue Details / Capital History
The company is coming out with its maiden book building route combo IPO worth Rs. 303.90 cr. (of approx. 21863309 equity shares at the upper cap). The IPO consists of fresh equity shares worth Rs. 290.00 cr. (approx. 20863309 equity shares at the upper cap) and an Offer for Sale (OFS) of 1000000 equity shares (worth Rs. 13.90 cr. at the upper cap). The company has announced a price band of Rs. 132 – Rs. 139 per equity shares of Rs. 10 each. The issue opens for subscription on September 25, 2026, and will close on September 29, 2026. The minimum application to be made is for 107 shares and in multiples thereon, thereafter. Post allotment, shares will be listed on BSE and NSE. The issue constitutes 29.02% of the post-IPO paid-up equity capital. From the net proceeds of the fresh equity issue, the company will utilize Rs. 226.33 cr. for capex on expansion of its manufacturing facility and hybrid solar and wind power plant, Rs. 7.70 cr. for repayment/prepayment of certain borrowings, and the rest for general corporate purposes.
The three joint Book Running Lead Managers (BRLMs) to this issue are Systematix Corporate Services Ltd., Emkay Global Financial Services Ltd., Pantomath Capital Advisors Pvt. Ltd., while Bigshare Services Pvt. Ltd. is the registrar to the issue. Systematix Shares and Stocks (India) Ltd., Emkay global financial Services Ltd., Asit C Metha Investment Intermediates Ltd. are syndicate members.
After issuing initial equity shares at par value, the company has issued/converted further equity shares in the price range of Rs. 20 – Rs. 1019 per share, between December 2008, and September 2025. The company also issued bonus shares in the ratio of 6 for 1 in March 2012, 1 for1 in March 2022, 5 for 1 in March 2025. The average cost of acquisition of shares by the promoters/selling stakeholders is Rs. 5.00, Rs. 15.28, and Rs. 45.92 per share.
Post-IPO, its current paid-up equity capital of Rs. 54.49 cr. (54485888 equity shares) will stand enhanced to Rs. 75.35 cr. (75349197 equity shares). Based on the upper cap of the price band, the company is looking for a market cap of Rs. 1047.35 cr.
On the financial performance front, for the last three fiscals, the company has (on a consolidated basis) posted a total income/net profit, of Rs. 1137.54 cr. / Rs. 41.67 cr. (FY24), Rs. 1517.21 cr. / Rs. 59.94 cr. (FY25), and Rs. 1685.38 cr. / Rs. 79.89 cr. (FY26). The company marked growth in its top and bottom lines for the reported fiscals.
Its contingent liabilities stood at Rs. 168.04 cr. as of March 31, 2026. Year-on-year surge in trade receivable raise concern.
For the last three fiscals, the company has posted an average EPS of Rs. 12.57 and an average RoNW of 20.17 %. The issue is priced at a P/BV of 1.79 based on its NAV of Rs. 77.76 as of March 31, 2026, and at a P/BV of 1.47 based on its post-IPO NAV of Rs. 94.72 per share at the upper cap.
If we attribute FY26 super earnings to its post-IPO fully diluted paid-up equity capital, then the asking price is at P/E of 13.11. Based on FY25 earnings, the P/E stands at 17.46. The issue appears fully priced based on its recent average performance.
For the reported periods, the company has reported PAT Margins of 3.69% (FY24), 3.98% (FY25), 4.76% (FY26), and RoCE margins of 18.62%, 15.91%, 19.31%, respectively, for the referred periods.
The company has not paid any dividends for the reported periods of the offer document. It has already adopted a dividend policy in May 2025, based on its financial performance and future prospects.
Comparison with Listed Peers
As per the offer document, the company has shown Beekay Steel, Gallant Ispat, Kamdhenu Ltd., MSP Steel, VMS TMT., as its listed peers. They are currently trading at a P/E of 18.4, 30.8, 13.4, 14.5, and 13.5 (as of September 23, 2026). However, they are not truly comparable on an apple-to-apple basis. This comparison appears to be an eyewash.
German Green Steel & Power Ltd. (GGSPL) is a vertically integrated iron and steel manufacturer primarily operating in the western region of India, with a presence in Gujarat with a main focus on TMT Bars (Source: CARE Report). It has two (2) manufacturing facilities located in the state of Gujarat (“Manufacturing Facilities”): one located at Samakhiyali (the “Samakhiyali Facility”) which is vertically integrated, and the other is located at Viramgam (“Viramgam Facility”) which is operated through its Material Subsidiary- German TMT Private Limited (formerly known as German TMX Private Limited). Steel scrap is one of its primary raw materials used in manufacturing process, enabling it to recycle ferrous material into finished steel products. As on the date of this Red Herring Prospectus, its product portfolio comprises mainly of TMT Bars, MS Billets and Sponge Iron.
Company’s TMT bar manufacturing capabilities range from 8 mm to 40 mm. As on date of this Red Herring Prospectus, the Company and its Material Subsidiary has received a Green Steel certificate from the National Institute of Secondary Steel Technology, Mandi Gobindgarh (India), pursuant to which its TMT bars were accorded a 4 star green steel rating and a 5 star green steel rating (Which is the highest green steel rating), respectively. Additionally, it has expanded product portfolio by entering the value-added steel products segment with the commencement of production of cut and bend bars and epoxy coated TMT bars.
As part of its continued focus on increasing the contribution of value-added and specialized steel products, GGSPL intends to further increase its presence in the production and sale of value-added products such as stainless steel round bars and cut and bend bars, which are pre-cut and shaped steel bars used in construction, epoxy coated TMT bars and corrosion resistant TMT bars. Through these initiatives, it seeks to broaden its product offerings, cater to evolving customer requirements and strengthen its position across the steel value chain.
The Company is a vertically integrated iron and steel manufacturer with a focus on TMT Bars. Company’s Samakhiyali Facility is a vertically integrated manufacturing facility where all stages of production starting from raw materials to finished steel products are carried out within the facility. Its Manufacturing Facilities are supported by its captive power plants. Its captive power plants include coal based power plant, waste heat recovery power plant and hybrid wind and solar plant. For FY26, it served 12 distributors, 148 dealers and 343 direct institutional customers. As of March 31, 2026, it had 1357 employees on its payroll, and additional 143 contractual workers.
Merchant Banker's Track Record
The three BRLMs associated with this issue has handled 22 IPOs in the last three fiscals and out of which 9 IPOs closed below the issue price on listing date.
Conclusion
GGSPL is a vertically integrated iron and steel manufacturer primarily operating in western region. It has its own captive power plants based on coal and also renewable energy like Wind and Solar power generation plants. Its major earnings come from TMT Bar which accounts over 60% of its revenue. The company posted steady growth in its top and bottom lines. Based on its recent average financial data, the issue appears fully priced. Well-informed investors can park funds for medium to long term rewards.
Dilip Davda is a veteran financial journalist associated with the Indian stock market since 1978. He has been contributing to print and electronic media on capital markets, insurance, and finance since 1985.
He is widely recognized for reviewing public issues and non-convertible debentures (NCDs) in the primary market. Drawing on over three decades of market experience and close interaction with merchant bankers, his reviews focus on detailed fundamental and financial analysis of companies, with a special emphasis on SME public issues.
Disclaimer: The information provided herein is solely for educational and informational purposes and does not constitute an offer, solicitation, or recommendation to buy or sell any securities. Readers are advised to consult a qualified financial advisor before making any investment decisions. Investments in the securities market are subject to market risks. The author does not intend to invest in the securities discussed.
