A-One Steels India Limited IPO

01At a glance

What the company does: makes steel, from sponge iron and MS billets through to TMT bars, HR and CR coils, pipes and galvanized tubes, at six plants in Karnataka and Andhra Pradesh, and also makes met coke and ferro alloys (RHP p.328).

Who pays it: 1,246 direct retail sales channels, 32 authorised distributors and 57 institutional customers in Fiscal 2026 (RHP p.341). The largest customer was 5.33% of FY26 revenue and the top ten 27.90% (RHP p.58). Karnataka was 54.86% of FY26 revenue (RHP p.54).

Why it is raising money: ₹25,000.00 lakh of the ₹35,500.00 lakh fresh issue prepays or repays borrowings in Fiscal 2027; the rest is general corporate purposes, not yet quantified (RHP p.211).

How fast it has grown: revenue from ₹3,83,421.25 lakh in FY24 to ₹4,14,856.74 lakh in FY26, about 4.0% a year, and profit after tax from ₹3,891.37 lakh to ₹12,740.82 lakh, about 80.9% a year (our arithmetic, RHP p.152).

The one thing to understand: this is a high volume, thin margin business carrying a lot of debt. EBITDA margin was 7.29% in FY26 (RHP p.224), net debt was ₹98,536.80 lakh against net worth of ₹81,952.16 lakh (RHP p.224), and operating cash flow fell from ₹32,539.75 lakh in FY24 to ₹6,279.56 lakh in FY26 (RHP p.155).

02The business, in plain words

A-One buys iron ore, coal and scrap, reduces the ore into sponge iron, melts it into MS billets, and rolls or draws those billets into TMT bars, coils, pipes and galvanized tubes (RHP p.328). Most of the intermediate output is consumed inside its own plants: 82.35% of sponge iron, 98.89% of MS billets and 88.81% of coils in Fiscal 2026 (RHP p.339). What is left over is sold, as are met coke, ferro alloys and traded raw materials (RHP p.339).

A builder or fabricator needs TMT bars or pipes → buys from a retail dealer, a distributor or direct → A-One makes them from its own sponge iron and billets → A-One keeps the spread between the steel price and the cost of ore, coal, scrap and power.

Operations began in 2013 with a 20,000 MTPA billet line at Gauribidanur (RHP p.328). The six units are Bellary Facility I and II, Gauribidanur, Hindupur, Chikkantapur and Koppal, three of them held by subsidiaries (RHP p.328). Aggregate installed capacity was 17,33,100 MTPA at March 2026 and crude steel capacity 5,70,000 MTPA (RHP p.339, RHP p.83). Renewable sources were 83.20% of electricity consumed in FY26 (RHP p.224).

Earnings equation: Profit ≈ tonnes sold × (realisation − ore, coal, scrap and power cost) − conversion cost − interest. In FY26 cost of materials consumed was ₹3,48,694.57 lakh and finance costs ₹10,919.18 lakh against revenue of ₹4,14,856.74 lakh (RHP p.152).

03Where the money comes from

Source: RHP p.338. Revenue from scrap, coal, MS billets, sponge iron and iron ore relates principally to trading, not manufacturing (RHP p.339).

Source: RHP p.58. Revenue does not depend on a few customers: no single customer was more than 7.00% of revenue in any of the three years (RHP p.341). It does depend on one state: Karnataka was 54.86% of FY26 revenue, Andhra Pradesh 11.35% and Tamil Nadu 7.21% (RHP p.54). Domestic sales of products were 93.49% of FY26 revenue (RHP p.120).

04The growth record

Source: RHP p.152, RHP p.155, RHP p.224.

Net debt was ₹99,278.97 lakh, ₹95,195.80 lakh and ₹98,536.80 lakh; the debt to equity ratio 2.34, 1.34 and 1.17; return on capital employed 8.67%, 7.03% and 12.86%; return on equity 8.75%, 1.07% and 14.76% (RHP p.224). Our arithmetic: revenue grew about 4.0% a year from FY24 to FY26 and profit after tax about 80.9% a year, while the EBITDA margin rose 280 basis points and the PAT margin 205 basis points (RHP p.152, RHP p.224).

FY25 carried an exceptional loss of ₹443.69 lakh and FY26 an exceptional gain of ₹52.68 lakh (RHP p.152). Other income was ₹3,472.86 lakh in FY26, 20.8% of profit before tax of ₹16,702.47 lakh (our arithmetic, RHP p.152).

05What the growth is made of

Revenue rose ₹31,435.49 lakh between FY24 and FY26, but the profit increase came from margin, not from the revenue line (our arithmetic, RHP p.152). Production in tonnes rose across the range: billets and MS ingots from 384,013 to 493,371 tonnes, long products from 190,728 to 253,343, HR coils from 132,382 to 170,384, MS and GP pipes from 131,874 to 188,789, ferro alloys from 7,196 to 23,719 and met coke from 48,274 to 90,776 (RHP p.224). Installed capacity went from 14,97,100 MTPA at March 2024 to 17,33,100 MTPA at March 2026 (RHP p.339).

Against that, revenue barely moved, because a large part of what is produced is consumed captively. The prospectus does not print a realisation per tonne, so the revenue line cannot be split into volume and price. Sales of intermediate and by-products outside the three customer channels rose from ₹67,317.07 lakh in FY24 to ₹1,31,785.58 lakh in FY26, from 17.56% to 31.77% of revenue (RHP p.54).

06Earnings quality

The item that needs explaining is cash. Operating cash flow fell from ₹32,539.75 lakh in FY24 to ₹6,279.56 lakh in FY26 while profit rose (RHP p.155). The prospectus's own cash flow shows why: trade receivables absorbed ₹22,859.78 lakh in FY26 and inventories ₹10,157.04 lakh, against ₹19,192.32 lakh released by trade payables (RHP p.154). Receivables rose 51.85% in one year, to ₹66,445.71 lakh (RHP p.71). Inventory days rose from 61 to 91 over the three years and payable days from 41 to 86 (RHP p.71), so the company is holding more stock and paying its suppliers later at the same time.

07The balance sheet

At March 2026, non-current borrowings were ₹33,605.93 lakh and current borrowings ₹67,487.84 lakh (RHP p.151). Cash and cash equivalents were ₹2,556.97 lakh and other bank balances ₹7,463.03 lakh (RHP p.150). The prospectus states net debt of ₹98,536.80 lakh and a debt to equity ratio of 1.17 (RHP p.224). Lease liabilities were ₹3,890.87 lakh non-current and ₹250.91 lakh current (RHP p.151). Property, plant and equipment was ₹63,344.85 lakh and capital work in progress ₹6,510.65 lakh (RHP p.150).

Contingent liabilities at March 2026 were ₹10,897.22 lakh in total: income tax ₹2,892.19 lakh, GST ₹3,056.49 lakh, intellectual property ₹200.01 lakh, a disputed electricity duty demand of ₹1,048.03 lakh, and guarantees of ₹3,700.50 lakh given mostly to renewable power companies (our arithmetic, RHP p.173).

After the issue: ₹25,000.00 lakh of the fresh issue repays borrowings (RHP p.211), which on the March 2026 figures would leave about ₹76,093.77 lakh of borrowings, and net worth would rise from ₹81,952.16 lakh by the fresh issue proceeds after expenses (our arithmetic, RHP p.151, RHP p.224).

08What the money is for

Source: RHP p.210, RHP p.211; the percentage is our arithmetic. The whole ₹25,000.00 lakh is scheduled for Fiscal 2027 (RHP p.211). The loans identified for repayment are from Bajaj Finance, Jio Credit, HDFC Bank, Axis Bank, ICICI Bank and State Bank of India (RHP p.211). General corporate purposes cannot exceed 25% of gross proceeds (RHP p.211), and the deployment has not been appraised by any bank or financial institution (RHP p.211).

Into the business ₹35,500.00 lakh, the fresh issue (RHP p.147). To selling shareholders ₹5,000.00 lakh, the offer for sale (RHP p.147).

09Who is selling

Source: RHP p.148, RHP p.200. The prospectus states the offer for sale in rupees, not in shares, because the price is not yet fixed (RHP p.148). At the upper band of ₹405 the three would together be offering about 12,34,567 shares (our arithmetic, RHP p.148). The average cost of acquisition is ₹6.57 a share for Sandeep Kumar, ₹8.04 for Sunil Jallan and ₹0.76 for Krishan Kumar Jalan (RHP p.120).

10Promoters

The promoters are Sandeep Kumar, Sunil Jallan and Krishan Kumar Jalan (RHP p.1). Sunil Jallan is Chairman and Whole Time Director and Sandeep Kumar is Managing Director; both hold shares directly (RHP p.440). Sunil Jallan was paid ₹144.00 lakh in each of FY24, FY25 and FY26, Sandeep Kumar ₹120.00 lakh in each year, and Uma Shankar Goyanka, a whole-time director, ₹18.00 lakh in each year (RHP p.440). Non-executive and independent directors receive sitting fees of ₹50,000 a meeting and no commission (RHP p.440).

Promoter economics, from the capital structure: the shares were sub-divided from ₹100 to ₹10 on April 25, 2024, and on the same day a bonus of five shares for every two was issued, 4,18,43,050 shares in all to the three promoters (RHP p.189). Before that, the last cash issues to the promoters were rights issues in March 2021 at ₹688 a share on the old ₹100 face value (RHP p.189). The weighted average cost of acquisition of the last five primary issuances and secondary transactions is ₹44.55 a share (RHP p.229).

Litigation touching the promoters: two criminal proceedings and 14 tax proceedings are pending against them, and two criminal proceedings have been brought by them (RHP p.87). One disciplinary action by SEBI or the stock exchanges is recorded against the company in the last five financial years (RHP p.87). The promoters have given personal guarantees and mortgaged property for the company's loans (RHP p.45).

11Who already owns it

Source: RHP p.199, RHP p.201. No shareholder other than the three promoters holds 1% or more of the capital, and that has been so for at least two years (RHP p.200). The public holding came from three private placements in 2024, all at ₹250 a share: 28,73,000 shares on June 5, 36,50,000 on June 20 and 33,62,000 on July 13 (RHP p.229). At the upper band, promoters would hold about 74.25% after the issue (our arithmetic, RHP p.201).

A scheme of amalgamation would fold two group companies, Basai Steels and Power and A-One Gold Pipes and Tubes, into the company, issuing 6,24,213 further shares and taking the pre-Offer count to 6,90,89,483; it is pending before the National Company Law Tribunal, with an appointed date of October 1, 2025 (RHP p.186, RHP p.187). The arithmetic in this study uses the 6,84,65,270 shares the prospectus states as outstanding.

12What changed just before the IPO

• The company was converted into a public limited company on August 30, 2024, and renamed A-One Steels India Limited (RHP p.406).
• The face value was sub-divided from ₹100 to ₹10 on April 25, 2024, and a 5:2 bonus issued the same day (RHP p.189).
• Three private placements at ₹250 a share, in June and July 2024, raised ₹24,712.50 lakh and created the 14.14% public holding (RHP p.229).
• Bellary Tubes Corporation, a customer and supplier that was a related party, ceased to be one on June 12, 2024; it had been ₹6,070.30 lakh of FY25 sales and ₹21,295.77 lakh of FY25 purchases (RHP p.157).
• A fire at the Gauribidanur facility on May 27, 2024 damaged a furnace, which was restored in July 2024, and the FY25 exceptional loss of ₹443.69 lakh follows from it (RHP p.105, RHP p.152).
• The Hindupur steel melting shop was shut down temporarily in FY26 after a breakdown (RHP p.105).
• Trade receivables rose 51.85% in FY26, to ₹66,445.71 lakh (RHP p.71).
• A scheme of amalgamation of two group companies was approved by the boards on March 14, 2026 and is pending at the NCLT (RHP p.186).
• There has been no change in the statutory auditors in the three preceding years; Singhi & Co are the auditors (RHP p.181).

13Capacity and expansion

Source: RHP p.93, RHP p.94, RHP p.83. Aggregate installed capacity for steel and industrial products was 17,33,100 MTPA at March 2026, up from 14,97,100 MTPA at March 2024; crude steel capacity was 5,70,000 MTPA (RHP p.339, RHP p.83). The issue funds no capital expenditure, so it adds no capacity (RHP p.211). Ferro alloys at the Chikkantapur facility and GP pipes at Bellary II ran below their installed capacity in FY26 (RHP p.83).

14Market size and industry structure

As claimed: Indian steel demand is stated to have grown 8% in 2025 and is expected to grow 6% to 8% in 2026, against a world total falling 1% to flat, citing the CRISIL report dated December 30, 2024 and updated in August 2026, which was commissioned and paid for by the company (RHP p.258, RHP p.259, RHP p.327). India is the second largest consumer of iron ore, with demand of about 267 million tonnes in 2025, on the same commissioned report (RHP p.255).

The part that is addressable: long and flat steel products and pipes sold mainly in Karnataka, Andhra Pradesh and Tamil Nadu, which together were 73.42% of FY26 revenue (our arithmetic, RHP p.54).

What the company is today: ₹4,14,856.74 lakh of FY26 revenue and 17,33,100 MTPA of installed capacity (RHP p.152, RHP p.339). The prospectus does not state the company's share of any market.

The prospectus describes an industry with high entry barriers and lists imports as a pressure on domestic prices and realisations (RHP p.219, RHP p.135).

15Competitive position

Source: RHP p.225. Working capital days were 53 for the company against 52, 74 and 13 for the three peers, and the debt to equity ratio 1.17 against 0.30, 0.18 and 0.08 (RHP p.225). The prospectus's qualitative case rests on backward integration, location near raw materials in Karnataka, a diversified product range and a certified green product portfolio (RHP p.219).

16Peers the company named

Peers named in the offer document: MSP Steel and Power, Jai Balaji Industries and Shyam Metalics and Energy, identified on the basis of the commissioned CRISIL report (RHP p.221).

Source: RHP p.222; peer P/E at BSE closing prices of September 11, 2026 (RHP p.222). Shyam Metalics is about 4.5 times the company's size by total income and Jai Balaji about 1.4 times, while MSP Steel is smaller (our arithmetic, RHP p.222). Steel Exchange India was considered and left out as smaller and narrower (RHP p.222). The industry EV to EBITDA range the prospectus prints is 12.71 to 18.17 times, average 14.71 (RHP p.221).

17Valuation at the issue price

At the upper band of ₹405, the ₹35,500.00 lakh fresh issue is about 87,65,432 new shares, added to 6,84,65,270 existing shares (our arithmetic, RHP p.147, RHP p.186):

Source: RHP p.152, RHP p.220, RHP p.224; the arithmetic is ours. At the lower band of ₹385 the market capitalisation is ₹2,99,091.29 lakh (our arithmetic, RHP p.147). Enterprise value, taking March 2026 net debt of ₹98,536.80 lakh as filed, is ₹4,11,321.14 lakh (our arithmetic, RHP p.224); ₹25,000.00 lakh of that debt is to be repaid from the issue (RHP p.211).

The three peers the prospectus names traded at 61.52, 45.76 and 28.31 times earnings on September 11, 2026, a median of 45.76 times (RHP p.222). At the upper band the issue is priced at 24.7 times FY26 profit on the enlarged share count, 46% below that median, and 21.9 times on the prospectus's own diluted EPS (our arithmetic, RHP p.222). On enterprise value the issue is at 13.5 times FY26 EBITDA against the industry range of 12.71 to 18.17 times the prospectus prints (our arithmetic, RHP p.221).

18Risks, in plain words

Debt: net debt was ₹98,536.80 lakh at March 2026 against net worth of ₹81,952.16 lakh (RHP p.224) → finance costs of ₹10,919.18 lakh in FY26 took 36.0% of EBITDA (our arithmetic, RHP p.152, RHP p.224) → ₹25,000.00 lakh of the issue repays borrowings (RHP p.211).

Cash conversion: profit was ₹12,740.82 lakh in FY26 and operating cash flow ₹6,279.56 lakh (RHP p.152, RHP p.155) → growth is being funded by working capital and borrowings → receivables rose 51.85% to ₹66,445.71 lakh and inventory days from 61 to 91 (RHP p.71).

One state: Karnataka was 54.86% of FY26 revenue (RHP p.54) → local demand, power or mining changes move the whole company → the next largest state, Andhra Pradesh, was 11.35% (RHP p.54).

Input prices: the company buys iron ore, coal and scrap and has no long-term customer contracts (RHP p.32, RHP p.59) → a rise in input cost cannot be passed on quickly → EBITDA margin was 4.49% in FY24 and 7.29% in FY26 (RHP p.224).

Plant interruption: a fire at Gauribidanur in May 2024 and a melting shop breakdown at Hindupur in FY26 both cut output (RHP p.105) → production stages are interconnected, so one stoppage moves through the chain → the FY25 exceptional loss was ₹443.69 lakh (RHP p.152).

Litigation and compliance: 33 tax proceedings and 25 statutory or regulatory proceedings are pending against the company, with four material civil matters (RHP p.87) → outcomes are uncertain and cash may be required → contingent liabilities were ₹10,897.22 lakh (our arithmetic, RHP p.173). Delays in filing statutory dues were recorded in each of the last three financial years (RHP p.120).

Issue-specific: ₹5,000.00 lakh of the offer goes to the three promoters and not to the company (RHP p.120), and the deployment of the fresh issue has not been appraised by any bank or financial institution (RHP p.211).

19Litigation and regulatory matters

The aggregate amount involved, to the extent ascertainable, is stated as ₹5,558.44 lakh for matters against the company, ₹1,069.19 lakh for the subsidiaries and ₹1,750.93 lakh for the promoters; these are amounts claimed or demanded, not amounts payable (RHP p.87). The company itself has brought 28 criminal proceedings, largely under Section 138 of the Negotiable Instruments Act over payment defaults, and 12 civil matters, involving ₹4,017.39 lakh (RHP p.87, RHP p.71).

The company's tax proceedings are ₹3,111.65 lakh of direct tax and ₹1,893.43 lakh of indirect tax across 33 cases (RHP p.636). One disciplinary action by SEBI or the stock exchanges is recorded against the company in the last five financial years (RHP p.87). Nothing is pending against the directors who are not promoters, the key managerial personnel or senior management (RHP p.87).

20Related-party transactions

Source: RHP p.157, RHP p.158, RHP p.159, RHP p.440; the interest and remuneration totals are our arithmetic. Bellary Tubes Corporation, which the prospectus describes as belonging to the wife of a then director, Manoj Kumar, stopped being a related party on June 12, 2024, and Manoj Kumar resigned the same day (RHP p.157, RHP p.156). Trading with Laksh Steels, a firm in which Krishan Kumar Jalan is a partner, also stopped in FY26 (RHP p.158). What remains in FY26 is interest on promoter loans, rent paid to promoters and to Laksh Steels, and small rent received from group companies (RHP p.160).

21What the offer document does not say

Realisation per tonne, by product or in total, is not disclosed, so revenue cannot be split into volume and price. Gross margin by product is not disclosed. The company's share of the TMT, pipe or sponge iron market is not stated. Installed capacity for TMT bars at the Hindupur facility is not stated separately, only its utilisation. The amount for general corporate purposes and the issue expenses are left blank. The order book is not disclosed.

22Five questions for management

1. What was the realisation per tonne on TMT bars and pipes in each of FY24, FY25 and FY26, and how much of the FY26 margin increase came from input costs rather than prices?
2. Why did trade receivables rise 51.85% in FY26 while revenue rose 17.13%, and how much of the March 2026 balance has since been collected?
3. What will borrowings and finance costs be after the ₹25,000.00 lakh repayment, and on which facilities?
4. What throughput was lost to the Hindupur shutdown and the Gauribidanur fire, in tonnes?
5. What are the terms of the promoters' unsecured loans on which ₹1,322.85 lakh of interest was charged in FY26, and will they be repaid from the issue?

1Sources and cited facts

This study was read from 1 document the company filed. The 124 figures it cites are listed under the document each came from, with the page and the sentence as printed.