Steel IPO Surge: Safeguard Duty Spurs Rs 4,000 Crore Push

Steel companies plan to raise Rs 4,000 crore through IPOs, encouraged by India's three-year safeguard duty on select steel imports. This policy aims to stabilize domestic steel prices, reviving fundraising plans. Over a dozen companies are set for public offerings, enhancing pricing and market confidence.

In a significant financial manoeuvre, steel and steel-linked firms are aligning to amass Rs 4,000 crore through Initial Public Offerings (IPOs) within the next year to 18 months. Merchant bankers attribute this to the Indian government's move to impose a three-year safeguard duty on certain flat steel imports.

Following a rather subdued 2025 for steel IPOs, the safeguard duty, effective from April 21, 2025, aims to enhance short-term pricing stability for local producers by escalating the import costs and diminishing price competition. Industry figures suggest this policy will rejuvenate postponed fundraising efforts amidst previously weak market sentiments.

A bulk of steel companies, predominantly the likes of AOne Steels India Ltd and Jindal Supreme (India) Ltd, are preparing their IPOs. Intended proceeds will fund capacity expansion, ventures into high-value steel markets, and potentially aid in green steel projects, thereby boosting ESG ratings.

(With inputs from agencies.)