Sambhv Steel Tubes IPO Forged for Growth: Product Mix Gets a Shiny Upgrade, Investors Take Notice

Sambhv Steel Tubes’ ₹540 crore IPO is drawing attention as the company sharpens its product mix and expands capacity, aiming to capture a larger share of India’s booming steel pipes market. The IPO, which combines a fresh issue of ₹440 crore and an offer-for-sale of ₹100 crore, is primarily focused on debt reduction and strengthening the balance sheet.

 

Key Highlights:

 

Product Mix Improvement: Sambhv has doubled its finished goods capacity to 5.1 lakh MTPA, adding new galvanized pipes and stainless-steel coils, and ramping up ERW pipes production. This move is expected to boost margins as higher-value products gain traction.

 

Financial Performance: FY24 revenue grew 37% year-on-year to ₹1,285.76 crore, with EBITDA margins at 12.4% and a return on net worth of 25.4%—outperforming several peers.

 

Debt Reduction: IPO proceeds will be used to retire ₹390 crore in borrowings, improving the debt-equity ratio and freeing up capital for further growth.

 

Industry Tailwinds: With domestic steel pipe demand projected to grow 8-9% annually through FY29, Sambhv is well-positioned to benefit from infrastructure and construction sector momentum.

 

Investor Response: The IPO has seen strong anchor investor interest and is commanding a 12% grey market premium, with most analysts recommending a ‘subscribe for long-term’ rating.

 

Outlook:

Sambhv’s strategic focus on value-added products, robust backward integration, and prudent financial management set the stage for sustained growth. As the product mix shifts toward higher-margin offerings, the company is poised to enhance profitability and market share in a rapidly expanding sector.

 

Sources: SPTulsian, Economic Times, CNBC TV18, Business Today, IPO Central, June 2025