Rama Steel Tubes Limited reported strong growth in sales volumes for Q3FY26 and nine months ended December 2025, reflecting healthy demand across its structural steel products. The company announced its performance through an exchange filing, demonstrating robust operational results with significant growth in both quarterly and nine-month periods.

Q3FY26 Performance Highlights

The company achieved notable volume growth during Q3FY26, with sales volume rising 14.00% year-on-year to 58,974.55 tonnes from 51,669.01 tonnes in the same quarter last year.

The quarterly performance represents an increase of 7,305.54 tonnes compared to the corresponding period in the previous fiscal year, demonstrating the company's ability to expand its market presence and meet increasing customer demand.

Nine-Month FY26 Performance

The company's nine-month performance showed even stronger momentum, with volumes increasing 23.00% year-on-year to 1,71,935.78 tonnes, up from 1,39,956.23 tonnes in the corresponding period of the previous year.

This represents an increase of 31,979.55 tonnes over the nine-month period, indicating sustained business expansion and strong operational consistency.

Growth Drivers and Market Position

The company attributed the growth to steady demand for its branded structural steel tubes and continued focus on expanding its presence in value-added products. Rama Steel Tubes manufactures ERW steel tubes, including black and galvanised pipes, catering to infrastructure, construction and industrial segments.

Stock Performance

Shares of Rama Steel Tubes were trading 0.21% higher at ₹9.37. However, the stock has declined 22.31% over the last six months, despite the company's strong operational performance. The manufacturer has been strengthening its global footprint through subsidiaries in the UAE and Nigeria, enhancing its international market presence.

Rama Steel Tubes has received a rating update from ICRA Limited, with the credit rating agency placing the company's bank loan facilities on rating watch with developing implications. The rating action, communicated through ICRA's letter dated December 20, 2023, affects the company's total bank facilities worth ₹110.00 crores.

Rating Update Details

ICRA has placed both long-term and short-term facilities under rating watch following recent corporate developments. The rating changes are detailed below:

Acquisition Driving Rating Watch

The rating watch stems from Rama Steel Tubes' board approval on December 11, 2023, for acquiring 100% stake in UAE-based Automech Group Holding Limited. The acquisition details are structured as follows:

ICRA's Assessment and Concerns

ICRA expects the acquisition to provide strategic benefits including expanded Middle East presence and diversification into relatively high-margin engineering and fabrication segments. The transaction is anticipated to improve the company's revenue base and enhance earnings diversification over the medium term.

However, ICRA has identified several key concerns:

• Scale Impact: The transaction size is sizeable relative to Rama Steel Tubes' current scale
• Leverage Pressure: Debt-funded component could impact leverage and coverage metrics
• Execution Risks: Cross-border nature of the deal presents integration challenges
• Regulatory Factors: Pending regulatory approvals and financing arrangements require monitoring

Company Background

Rama Steel Tubes Limited, incorporated in 1974 by Mr. Harbans Lal Bansal, manufactures and trades steel tubes, pipes, and galvanised iron pipes. Currently managed by Mr. Naresh Kumar Bansal and grandson Mr. Richi Bansal, the company operates four manufacturing facilities located at Sahibabad (Uttar Pradesh), Khopoli (Maharashtra), and Anantpur (Andhra Pradesh) with total production capacity of 2,94,000 MTPA as of March 31, 2023.

The company maintains subsidiaries in UAE and Nigeria, with recent portfolio changes including the divestment of stakes in Hagar Mega Mart Private Limited completed in 2022. The product range includes MS ERW black pipes of 15mm-200mm diameter and galvanised iron pipes of 15mm-150mm NB in various sizes.

Rating Outlook

ICRA will closely monitor developments related to the transaction, including financing arrangements, regulatory approvals, and operational synergies. The rating agency indicated it will take appropriate rating action once greater visibility emerges on these factors. Automech Group's historically comfortable earnings are expected to provide support to consolidated profitability and debt protection metrics, offering some positive offset to the identified concerns.