Rama Steel Tubes Share Price in Focus Amid Expansion into Defence and Green Energy

Rama Steel Tubes Limited (RSTL) is a pioneer and leading manufacturer of steel Pipes & Tubes and G.I. Pipes in India established in 1974 by Sh. H.L. Bansal, Rama is one of the most trusted and established names in the Steel Tube and pipe market in India and one which is rapidly gaining recognition globally. RSTL has been continuously striving to improve its performance by increasing sales, the share of value-added products, innovating new products and aggressive cost optimisation on a continual basis. RSTL products range includes MS ERW black pipes from 15mm to 200mm diameter pipes and G.I. Pipes from 15mm to 150mm NB in light, medium and heavy sizes. RSTL has a global presence in more than 16 Countries.

Share price of Rama Steel Tubes is trading down by 0.95% on NSE as of 10:55 AM on February 27, 2025. So far in the month of February, the stock price is down by nearly 13.7%.

Financial Performance in Q3FY25

Rama Steel Tubes Limited (RSTL), announced its consolidated financial results for Q3FY25. The company recorded total revenue of ₹2804.60 million, reflecting a 2.89% increase compared to the previous quarter. Additionally, sales volume rose by 1.47%, indicating stable demand across various sectors.

In terms of profitability, RSTL’s EBIDTA grew by 4.24% on a quarter-on-quarter (QoQ) basis. The most notable improvement was in net profit, which surged 39.24%, primarily driven by a 60% reduction in finance costs, owing to improved fund utilisation and better price negotiations.

Expansion into Defence and Green Energy

As part of its diversification strategy, RSTL has incorporated a wholly owned subsidiary, Rama Defence Private Limited, to engage in manufacturing, trading, and supplying defence equipment, arms, ammunition, and security hardware. This move aligns with the company’s long-term goal of expanding into high-growth sectors.

Additionally, RSTL has taken significant strides in the renewable energy sector by acquiring a 40% stake in Oram Green Energy Limited, a newly incorporated company focusing on green energy solutions.

Management Insights

Richi Bansal, Executive Director & CEO of RSTL, highlighted that despite the volatile operating environment, the company has achieved steady volume growth. Sales volumes increased by 7% year-on-year (YoY), rising from 131,137.81 metric tonnes in 9MFY24 to 139,956.23 metric tonnes in 9MFY25.

However, revenue in value terms declined by 21.70% in FY24 compared to FY23 due to fluctuations in raw material prices.

Conclusion

RSTL’s Q3FY25 results highlight steady financial performance and strategic diversification. The company’s expansion into the defence and renewable energy sectors, coupled with stake acquisitions, indicates a long-term growth vision. While challenges such as raw material price fluctuations remain, RSTL’s focus on cost efficiency and market expansion positions it for sustained progress in the coming quarters.

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