At a glance:
Hariom Pipe is that rare steel player that doesn’t just roll pipes — it controls the entire value chain, from sponge iron to the final SKU. And with 800+ products, a new solar ambition, and a 51% profit CAGR over 5 years, this is a BSE Smallcap that behaves like it’s APL Apollo’s lesser-known cousin… trying to grow facial hair.

🏢 About the Company

• Incorporated: 2008
• Business: Vertically integrated manufacturer of steel pipes and products
• Capacity: From sponge iron to billets, HR strips to final pipe products
• SKU Count: 800+ (Yes, even Flipkart has less variety)
• New Plan: 60 MW solar project under PM-KUSUM scheme = Green Steel vibes

👥 Key Managerial Personnel (KMP)

• Promoter Holding:
  • FY22: 66.03%
  • FY25: 57.27% 📉 (Slight dilution, but stable since FY24)
• FII Interest:
  • Up from 2% to 9.49% in 3 years = institutional tailwind
• Number of Shareholders:
  • 38,000 → 54,000 = growing retail fanbase

📊 5-Year Financial Performance

Sales CAGR: 53% | Profit CAGR: 51% | TTM Sales: ₹1,357 Cr

🔮 Forward Fair Value (FV) Estimate (EduInvesting-style)

Let’s use FY25 numbers:

• EPS: ₹19.93
• CMP: ₹426
• PE: 21.5x

Peers like APL Apollo trade at 69x, Ratnamani at 37x. Let’s be conservative.

🎯 Fair Value Range (12–18 months): ₹520–₹600

🚀 Growth Triggers

1. Solar Expansion

• 60 MW solar under PM-KUSUM → lower power cost → margin buffer
• ESG angle = potential rerating?

2. Capex-Powered Growth

• Fixed Assets grew from ₹54 Cr (FY22) → ₹424 Cr (FY25)
• Borrowings rose to ₹401 Cr, but growth justifies it (ROCE > cost of capital)

3. FIIs Are In

• FII holding jumped from 2.5% to 9.5% — quietly accumulating while the stock cooled off

4. Volume Growth + Pricing Power

• Q4 FY25:
  • Volume up 23%
  • EBITDA up 27%
  • Price realisation holding steady

🧾 Balance Sheet Breakdown

Key Watch: Debt increased 4.6x in 3 years, but backed by 8x asset expansion.

📉 Risks & Red Flags 🚨

• Capex-heavy model = debt pressure
• ROCE downtrend: From 28% → 14% = efficiency watch
• Stock down 26% in 1 year — despite consistent profits
• FIIs have slowed additions since Q3 FY24
• Working Capital Cycle: Still high (~132 days)

🧠 EduInvesting Take

Hariom Pipe is your desi “make-everything-in-house” steel player — part Micromax, part Tata Steel. It has executed an ambitious vertical integration model while growing profits 50% CAGR for 5 years. But that PE of 21x? It’s not too cheap anymore. You’re paying for consistency, not chaos.

If they deliver on the solar promise, cut debt, and maintain margin — rerating is possible. But if debt balloons or capacity hits demand headwinds, the pipe dream may rust.

🏁 TL;DR Recap

Tags: Hariom Pipe Recap, Hariom Pipe FY25 Results, Steel Pipe Stock India, Backward Integration, PM-KUSUM Solar Steel, Multibagger Steel SME, EduInvesting Stock Review, Hariom Pipe Valuation 2025

Author: Prashant Marathe
Date: June 11, 2025