German Green Steel and Power Limited IPO

01At a glance

What the company does: makes sponge iron, MS billets and TMT bars at Samakhiyali in Kutch and, through its subsidiary German TMT, at Viramgam, both in Gujarat, with captive coal, waste heat, wind and solar power (RHP p.313, RHP p.146).

Who pays it: distributors, dealers and institutional buyers, who were 37.57%, 20.89% and 41.53% of FY26 revenue (RHP p.29). The top ten customers were 50.62% of FY26 revenue and the largest 10.67% (RHP p.29).

Why it is raising money: ₹22,633.05 lakh of the ₹29,000.00 lakh fresh issue funds an expansion at Samakhiyali and a hybrid wind and solar plant, a project costing ₹34,813.58 lakh in all; ₹769.99 lakh repays borrowings (RHP p.142, RHP p.146).

How fast it has grown: revenue from ₹1,12,978.18 lakh in FY24 to ₹1,67,898.17 lakh in FY26, about 21.9% a year, and profit after tax from ₹4,166.66 lakh to ₹7,988.87 lakh, about 38.5% a year (our arithmetic, RHP p.84).

The one thing to understand: this is a capital-hungry expansion financed partly by the issue. Payments for plant were ₹13,318.49 lakh in FY26 after ₹24,619.56 lakh in FY25, capital work in progress stood at ₹16,065.48 lakh at March 2026, and the new project will cost ₹34,813.58 lakh, of which ₹22,633.05 lakh comes from the issue (RHP p.85, RHP p.82, RHP p.146).

02The business, in plain words

German Green Steel buys iron ore and coal, makes sponge iron, melts it into MS billets and rolls the billets into TMT bars from its two Gujarat plants, selling mostly through distributors and dealers to builders and contractors, and directly to institutional buyers (RHP p.313, RHP p.29). Part of its power comes from its own plants: 16.0 MW coal-based, 4.0 MW waste heat recovery and a hybrid wind and solar plant at Bhavnagar (RHP p.146).

A builder in Gujarat needs reinforcement bar → orders from a German Green distributor or dealer → the company makes sponge iron, billets and bars at Samakhiyali or Viramgam → the company keeps the spread between the bar price and the cost of ore, coal, scrap and power.

The company was incorporated as Haq Enterprises Private Limited in 2008, renamed Haq Steels and Metaliks in 2018, became a public limited company in May 2018, and took its present name in January 2024 (RHP p.340). TMT bars were ₹1,32,196.23 lakh of FY26 revenue, MS billets ₹10,115.72 lakh and sponge iron ₹3,109.62 lakh (RHP p.183).

Earnings equation: Profit ≈ tonnes of TMT sold × (price − ore, coal, scrap and power cost) − conversion cost − depreciation − interest. In FY26 raw materials consumed were ₹1,07,783.96 lakh, purchases of stock in trade ₹18,544.40 lakh and finance costs ₹4,295.87 lakh against revenue of ₹1,67,898.17 lakh (RHP p.84).

03Where the money comes from

Source: RHP p.183, RHP p.84.

Source: RHP p.29. Revenue depends on a group of customers rather than one: the top ten were half of FY26 revenue, but the concentration has fallen in each of the three years. By channel, distributors fell from 52.94% of FY24 revenue to 37.57% in FY26 while dealers rose from 3.23% to 20.89% (RHP p.29). Customers are concentrated in Gujarat: of the named top ten in FY26, all are in Gujarat (RHP p.30).

04The growth record

Source: RHP p.84, RHP p.85, RHP p.183, RHP p.82.

Return on net worth was 23.67%, 20.40% and 18.86%; return on capital employed 18.62%, 15.91% and 19.31%; the debt to equity ratio 1.13, 1.18 and 0.79; inventory turnover 6.81, 4.71 and 4.20 times (RHP p.183). Our arithmetic: revenue grew about 21.9% a year from FY24 to FY26 and profit after tax about 38.5% a year, while the EBITDA margin rose 292 basis points and the PAT margin from 3.69% to 4.76% (RHP p.84, RHP p.183). Other income was ₹639.52 lakh in FY26, 5.8% of profit before tax of ₹10,980.81 lakh (our arithmetic, RHP p.84).

05What the growth is made of

TMT bars. Their revenue rose from ₹71,319.14 lakh in FY24 to ₹1,32,196.23 lakh in FY26, while billets fell from ₹17,503.11 lakh to ₹10,115.72 lakh, so the company is selling more of its own billet output as finished bar instead of selling the billet (RHP p.183). Production bears that out: combined TMT bar output rose from 2,27,352 tonnes in FY24 to 2,65,097 tonnes in FY26, while combined billet output was 2,88,015 tonnes in FY24 and 2,83,654 tonnes in FY26 (our arithmetic, RHP p.313).

TMT capacity did not change over the three years, at 1,81,500 tonnes a year at Samakhiyali and 1,20,450 tonnes at Viramgam, so the extra bar came from higher utilisation: Viramgam's TMT line went from 66.62% to 92.66% and Samakhiyali's from 81.05% to 84.37% (RHP p.313). The prospectus does not print a realisation per tonne, so the revenue increase cannot be split into volume and price.

06Earnings quality

Cash from operations covers profit comfortably and improved each year, to ₹14,080.40 lakh in FY26 (RHP p.85). What that cash does not cover is the building: payments for plant, capital work in progress and capital advances were ₹7,780.47 lakh, ₹24,619.56 lakh and ₹13,318.49 lakh over the three years, so the gap was funded by borrowing and by share issues of ₹3,236.34 lakh in FY25 and ₹4,962.60 lakh in FY26 (RHP p.85). Inventory rose from ₹12,771.34 lakh to ₹29,809.03 lakh and turnover fell from 6.81 to 4.20 times over the same period (RHP p.82, RHP p.183).

07The balance sheet

At March 2026, non-current borrowings were ₹15,456.23 lakh and current borrowings ₹17,980.32 lakh; cash was ₹125.88 lakh and other bank balances ₹2,026.09 lakh, so net debt was about ₹31,284.58 lakh against total equity of ₹42,369.59 lakh (our arithmetic, RHP p.82). The prospectus states the debt to equity ratio at 0.79, down from 1.18 a year earlier (RHP p.183). Property, plant and equipment was ₹48,829.27 lakh and capital work in progress ₹16,065.48 lakh (RHP p.82). Trade payables were ₹32,954.24 lakh (RHP p.82).

Contingent liabilities and commitments at March 2026 totalled ₹16,803.50 lakh: income tax matters in dispute ₹11,265.20 lakh, GST ₹720.48 lakh, VAT ₹75.92 lakh, bank guarantees net of margin ₹1,493.64 lakh, and capital commitments of ₹3,248.26 lakh (RHP p.87). Excluding the capital commitments, contingent liabilities were ₹13,555.24 lakh (our arithmetic, RHP p.87).

After the issue: ₹769.99 lakh of the fresh issue repays borrowings and ₹22,633.05 lakh goes into the new project, so net debt falls little and fixed assets rise (RHP p.142).

08What the money is for

Source: RHP p.142; the percentages are our arithmetic. The project costs ₹34,813.58 lakh in all, including GST: building and civil work ₹4,778.06 lakh, plant and machinery ₹24,127.61 lakh, utilities ₹5,225.29 lakh and contingency ₹682.62 lakh, certified by CARE Analytics and Advisory in a detailed project report dated September 11, 2026 (RHP p.146).

The equipment quoted includes a kiln at ₹9,707.34 lakh, a rolling mill of 165,000 tonnes a year at ₹4,956.00 lakh, a structural mill at ₹4,708.20 lakh, an induction furnace at ₹1,806.00 lakh and an epoxy and zinc coating line at ₹1,277.02 lakh (RHP p.147, RHP p.162). The land is already owned, 5,74,956 square metres at Samakhiyali (RHP p.146). Orders for some of the equipment have not been placed (RHP p.144).

The balance of the project cost is to come from a term loan sanctioned by HDFC Bank (RHP p.143).

Into the business ₹29,000.00 lakh, the fresh issue (RHP p.78). To selling shareholders the proceeds of 10,00,000 shares, ₹1,390.00 lakh at the upper band (our arithmetic, RHP p.78).

09Who is selling

Source: RHP p.141, RHP p.124; the percentages are our arithmetic. At the upper band of ₹139 the two would together receive about ₹1,390.00 lakh before expenses (our arithmetic, RHP p.78).

10Promoters

The promoters are Inamulhaq Shamsulhaq Iraki, Abdulhaq Shamsulhaq Iraki and Ibrarulhaq Inamulhaq Iraki (RHP p.1). The two selling promoters hold 40.91% and 39.42% of the company before the issue; promoter and promoter group together, seven holders, hold 96.63% (RHP p.124, RHP p.123).

Promoter economics: remuneration to the three promoters was ₹217.50 lakh in FY24 and ₹375.00 lakh in FY26, of which ₹157.50 lakh each to Inamulhaq Shamsulhaq Iraki and Abdulhaq Shamsulhaq Iraki (our arithmetic, RHP p.91, RHP p.88). The family has also lent to and been repaid by the company: unsecured loans taken from promoters and relatives in FY26 included ₹345.00 lakh from Inamulhaq Shamsulhaq Iraki and ₹80.00 lakh from Ibrarulhaq Inamulhaq Iraki, against outstanding balances at March 2026 of ₹1.65 lakh and ₹8.36 lakh, down from ₹1,034.75 lakh and ₹1,115.98 lakh at March 2024 (RHP p.88, RHP p.92).

Litigation: 16 tax proceedings are pending against the promoters, involving ₹3,218.94 lakh, and no disciplinary action has been taken by SEBI or the stock exchanges (RHP p.43).

11Who already owns it

Source: RHP p.124, RHP p.123. The company has 45 shareholders; the public holds 18,38,000 shares, 3.37%, all of them from the pre-IPO placement (RHP p.124, RHP p.123). That placement was 18,38,000 shares at ₹270 each, ₹4,962.60 lakh, on September 26, 2025, and the fresh issue was cut by that amount (RHP p.142). At the upper band, promoter and promoter group holding would fall to about 68.5% after the issue (our arithmetic, RHP p.123).

12What changed just before the IPO

• The pre-IPO placement of 18,38,000 shares at ₹270 raised ₹4,962.60 lakh on September 26, 2025, and reduced the fresh issue by the same amount (RHP p.142).
• Of those proceeds, ₹2,672.63 lakh has gone into the Samakhiyali project and ₹2,289.97 lakh to general corporate purposes, certified by the statutory auditors (RHP p.142).
• The statutory auditors changed: KPSJ & Associates LLP resigned on November 4, 2023, S A M A S & Associates was appointed in a casual vacancy on January 16, 2024, and Talati and Talati LLP joined as joint statutory auditors from July 17, 2024 (RHP p.98).
• The auditors included an emphasis of matter for Fiscals 2025 and 2024 (RHP p.44).
• The company was renamed German Green Steel and Power Limited in January 2024, from Haq Steels and Metaliks Limited (RHP p.340).
• Capital spending of ₹24,619.56 lakh in FY25 and ₹13,318.49 lakh in FY26 took property, plant and equipment from ₹22,120.68 lakh to ₹48,829.27 lakh (RHP p.85, RHP p.82).
• Promoter and family unsecured loans of about ₹2,500 lakh outstanding at March 2024 were largely repaid by March 2026 (RHP p.92).
• A hybrid wind and solar plant at Bhavnagar was partially commissioned on July 18, 2025 and January 19, 2026 (RHP p.145).
• Promoter remuneration rose from ₹217.50 lakh in FY24 to ₹375.00 lakh in FY26 (our arithmetic, RHP p.91, RHP p.88).

13Capacity and expansion

Source: RHP p.313. Installed capacity was unchanged across FY24, FY25 and FY26 (RHP p.313). Captive power is 16.0 MW coal-based, 4.0 MW waste heat recovery, 8.1 MW of wind and 3.6 MW DC of solar at August 31, 2026, with a further 3.6 MW DC of solar and 5.4 MW of wind at Bharuch expected by December 31, 2026 (RHP p.146, RHP p.145).

What the issue adds: the project includes a rolling mill rated at 165,000 tonnes a year, a structural section mill, a kiln, an induction melting furnace, a two-strand continuous casting machine and an epoxy and zinc coating line at Samakhiyali, plus wind and solar capacity (RHP p.147, RHP p.162). The prospectus gives the equipment ratings but does not state the total installed capacity the plant will have when the project is done.

14Market size and industry structure

As claimed: India's steel consumption is expected to grow 8% year on year in FY27, supported by a ₹12.2 lakh crore public capital expenditure allocation in the Union Budget 2026-27, citing the CARE report commissioned by the company (RHP p.146, RHP p.28).

The part that is addressable: TMT bars and related long steel sold in Gujarat and nearby states through distributors, dealers and institutional buyers (RHP p.29, RHP p.30).

What the company is today: ₹1,67,898.17 lakh of FY26 revenue, of which ₹1,32,196.23 lakh was TMT bars, on 3,01,950 tonnes of TMT capacity across two plants (RHP p.183, RHP p.313). The prospectus does not state the company's share of any market.

15Competitive position

Source: RHP p.182. Gallant Ispat is about 2.7 times the company's total income and MSP Steel about 1.7 times; Kamdhenu and VMS TMT are smaller (our arithmetic, RHP p.182). What the company sells on is integration from sponge iron to bar, captive and renewable power, and a dealer and distributor network in Gujarat (RHP p.313, RHP p.146, RHP p.29).

16Peers the company named

Peers named in the offer document: Beekay Steel Industries, Gallant Ispat, Kamdhenu, MSP Steel & Power and VMS TMT (RHP p.182).

Source: RHP p.182; P/E at BSE closing prices of September 9, 2026 (RHP p.183). The prospectus states an average P/E of 35.25, calculated from the highest and lowest of the set (RHP p.182). The set spans a company nearly three times the size (Gallant Ispat) and two that are smaller, and the return on net worth of the set ranges from 3.28% to 19.77% against the company's 18.86% (RHP p.182).

17Valuation at the issue price

At the upper band of ₹139, the ₹29,000.00 lakh fresh issue is about 2,08,63,309 new shares, added to 5,44,85,888 existing shares (our arithmetic, RHP p.78, RHP p.141):

Source: RHP p.84, RHP p.182, RHP p.183; the arithmetic is ours. At the lower band of ₹132 the market capitalisation is ₹1,00,921.37 lakh (our arithmetic, RHP p.78). Enterprise value, with March 2026 net debt of about ₹31,284.58 lakh, is ₹1,36,019.96 lakh (our arithmetic, RHP p.82).

The five peers the prospectus names traded between 8.92 and 61.57 times earnings on September 9, 2026, a median of 22.54 times (our arithmetic, RHP p.182). At the upper band the issue is priced at 13.1 times FY26 profit on the enlarged share count, 42% below that median, and 9.3 times on the prospectus's own earnings per share, which uses the share count before the issue (our arithmetic, RHP p.182).

18Risks, in plain words

The project: ₹22,633.05 lakh of the issue goes into a ₹34,813.58 lakh expansion whose equipment has not all been ordered (RHP p.146, RHP p.144) → delay or cost escalation would push out the return, and the balance depends on a term loan from HDFC Bank (RHP p.143) → the company's whole FY26 profit was ₹7,988.87 lakh (RHP p.84).

Utilisation: TMT capacity did not change in three years and ran at 84.37% at Samakhiyali and 92.66% at Viramgam in FY26 (RHP p.313) → new capacity has to find new demand → billet utilisation at Samakhiyali fell from 86.49% in FY24 to 76.42% in FY26 (RHP p.313).

Debt: net debt was about ₹31,284.58 lakh at March 2026 and finance costs ₹4,295.87 lakh in FY26 (our arithmetic, RHP p.82, RHP p.84) → interest took 39.1% of EBITDA (our arithmetic, RHP p.183) → the debt to equity ratio was 0.79, down from 1.18 (RHP p.183).

Customers and one state: the top ten were 50.62% of FY26 revenue and the largest 10.67% (RHP p.29) → losing one would move revenue by a proportion that cannot be replaced quickly → the named top ten are all in Gujarat (RHP p.30).

Tax demands: 26 tax proceedings against the company involve ₹10,874.72 lakh, and 16 against the promoters ₹3,218.94 lakh (RHP p.43) → an adverse order would take cash → income tax matters in dispute alone are carried as ₹11,265.20 lakh of contingent liability (RHP p.87).

Related parties: purchases from Iraki Enterprise were ₹6,229.67 lakh in FY26, 3.71% of revenue, and sales to it ₹2,009.58 lakh (RHP p.88) → the terms are not tested against unrelated suppliers in the pages read → sales to four Kaavyaratna partnerships were ₹1,918.64 lakh in FY26 (our arithmetic, RHP p.88).

Auditors and safety: the auditors included an emphasis of matter for Fiscals 2025 and 2024 (RHP p.44) → the basis of preparation was drawn to readers' attention → the prospectus also records three workplace deaths, in Fiscals 2023, 2024 and 2026, with compensation of ₹16.70 lakh, ₹12.59 lakh and ₹16.38 lakh paid (RHP p.43).

19Litigation and regulatory matters

Source: RHP p.43; amounts are as claimed or demanded, to the extent quantifiable, not amounts payable. Nothing is pending against the directors who are not promoters, or against the key managerial personnel and senior management (RHP p.43). No disciplinary action has been taken by SEBI or the stock exchanges against the promoters (RHP p.43). There is no outstanding litigation involving the group companies that would have a material impact (RHP p.44).

20Related-party transactions

Source: RHP p.88; the remuneration and rent totals are our arithmetic. Unsecured loans from the promoters and their relatives, which stood at about ₹2,457 lakh at March 2024 across the family, were down to ₹157.41 lakh at March 2026 (our arithmetic, RHP p.92). Trade receivables from related parties at March 2026 were ₹2,073.27 lakh, mostly from the Kaavyaratna partnerships (our arithmetic, RHP p.92). Salaries were also paid in FY26 to nine family members other than the promoters, ₹217.61 lakh in all (our arithmetic, RHP p.88).

21What the offer document does not say

Realisation per tonne and gross margin by product are not disclosed, so the revenue increase cannot be split into volume and price. The total installed capacity the Samakhiyali plant will have after the expansion is not stated, only the ratings of individual machines. The names of two of the top ten FY26 customers are withheld for want of consent. How much of the ₹34,813.58 lakh project the HDFC Bank term loan will fund is not stated in the pages read. Whether the rates paid to Iraki Enterprise compare with unrelated suppliers is not addressed. The amount for general corporate purposes and the issue expenses are left blank.

22Five questions for management

1. What was the realisation per tonne on TMT bars in each of FY24, FY25 and FY26, and how much of the margin increase came from lower input costs rather than price?
2. What will the installed capacity of Samakhiyali be when the project is complete, and when is each line expected to start?
3. How much of the ₹34,813.58 lakh project will the HDFC Bank term loan fund, and on what terms?
4. On what basis are purchases of ₹6,229.67 lakh a year made from Iraki Enterprise, and how do the rates compare with unrelated suppliers?
5. What is the status of the income tax matters carrying ₹11,265.20 lakh of contingent liability, and when are they expected to be decided?

24Draft to final: what changed

The latest audited year is FY26 in both documents, because the draft was updated by an addendum carrying the FY26 restated financial information, and the revenue and profit for that year are the same in both (DRHP addendum p.8, RHP p.84).

1Sources and cited facts

This study was read from 1 document the company filed. The 85 figures it cites are listed under the document each came from, with the page and the sentence as printed.