Shares of Vibhor Steel Tubes surged by 12% on December 6, following the company’s announcement that its Unit III plant in Sundargarh, Odisha, is now fully prepared for operations. The facility is anticipated to commence operations by the end of January 2025, marking a key milestone in the company’s expansion plans.
At 1:50 PM, Vibhor Steel’s stock was trading at Rs 247, reflecting a 9% intraday increase. Despite this recent rally, the stock has struggled in 2024, declining by 45% year-to-date, compared to a 14% gain in the Nifty 50. After a weak performance in October and a 12% drop in November, December has seen a resurgence, with the stock climbing 10% so far. In a regulatory filing, Vibhor Steel attributed the delays in the Odisha plant’s operations to challenges in securing electricity connections from contractors and the Odisha Industrial Infrastructure Development Corporation (IDCO). The plant’s initial operational target was November 2024. However, all other construction and setup activities are now complete, and the company is collaborating with authorities to expedite the electricity connection process.
Incorporated in 2003, Vibhor Steel specialises in manufacturing, exporting, and distributing steel pipes and tubes. Its product portfolio includes ERW black pipes, galvanised pipes, hollow sections, and primer-painted pipes, catering to construction, agriculture, domestic, and industrial sectors. The company’s manufacturing footprint includes two existing facilities in Sukheli, Maharashtra, with a capacity of 1.25 lakh MTPA, and Mehboob Nagar, Telangana, with a capacity of 96,000 MTPA. Financially, Vibhor Steel has faced headwinds. In Q2FY25, net profit plummeted 82.8% to Rs 89 lakh, compared to Rs 518 lakh in the same period last year. Revenue also declined by 15.7% to Rs 236.09 crore from Rs 280.17 crore. The operationalisation of the Odisha plant is expected to revitalise the company’s growth trajectory and enhance capacity utilisation.
