VSSLVardhman Special Steels Ltd. (currently trading at ₹283) is a leading manufacturer of alloy and special steels catering to automotive, engineering, and defense sectors. Headquartered in Ludhiana, Punjab, the company operates a fully integrated steel plant with melting, rolling, and heat treatment capabilities. It supplies to marquee OEMs like Maruti Suzuki, Hyundai, Toyota, and Bosch, and has a strategic partnership with Aichi Steel Corporation (Toyota Group), which holds a minority stake and supports technology transfer and global client onboarding.
Vardhman Special Steels – FY22–FY25 Snapshot
• Sales – ₹1,100 Cr → ₹1,430 Cr → ₹1,620 Cr → ₹1,780 Cr Growth driven by auto-grade alloy steel and export traction
• Net Profit – ₹60 Cr → ₹85 Cr → ₹105 Cr → ₹125 Cr Earnings supported by margin expansion and operating leverage
• Operating Performance – Moderate → Strong → Strong → Strong EBITDA margins improving with product mix and backward integration
• Dividend Yield (%) – 0.50% → 0.60% → 0.65% → 0.70% Steady payouts aligned with profit growth
• Equity Capital – ₹36.00 Cr (constant) No dilution; lean capital structure
• Total Debt – ₹180 Cr → ₹160 Cr → ₹140 Cr → ₹120 Cr Gradual deleveraging supported by internal accruals
• Fixed Assets – ₹480 Cr → ₹520 Cr → ₹560 Cr → ₹600 Cr Capex focused on forging, heat treatment, and alloy upgrades
Institutional Interest & Ownership Trends
Promoter holding stands at 60.00%, with no pledging. Aichi Steel (Toyota Group) holds ~11% strategic stake. FIIs and DIIs have selectively accumulated citing auto-grade steel demand and export visibility.
Business Growth Verdict
Vardhman is scaling across alloy steel, forging, and global OEM supply chains Margins improving due to backward integration and high-value product mix Debt is declining steadily with strong operating cash flows Capex supports long-term competitiveness and export readiness
Management Con Call
• Q1 FY26 revenue rose 14.5% YoY to ₹460 Cr; PAT up 18.2% YoY to ₹32 Cr • Auto OEM volumes up 22% YoY; exports to ASEAN and EU gaining traction • Commissioned new heat treatment line; forging capacity expansion underway • FY26 outlook: 12–15% revenue growth, margin retention, and PAT expected to cross ₹140 Cr
Final Investment Verdict
Vardhman Special Steels Ltd. offers a high-quality specialty steel story built on metallurgical depth, OEM relationships, and export scale. Its improving profitability, disciplined capital structure, and expanding alloy portfolio make it suitable for accumulation by investors seeking exposure to India’s auto, engineering, and defense supply chains. With strong execution, Toyota-backed credibility, and forging-led margin expansion, VSSL remains a durable value creator in the alloy steel space.
