Scan Steels June 2026 investor presentation: a three-theme capacity plan anchored in integration and captive power

Scan Steels Limited, a 30-year-old integrated secondary steel producer headquartered in Odisha, used its June 2026 investor presentation to frame a multi-year scale-up roadmap built around three themes: near-term debottlenecking, downstream value addition, and a large greenfield integration project.

The audited FY26 starting point presented by the company is a standalone revenue of INR 838 crore, EBITDA of INR 49 crore (5.9 percent margin), and PAT of INR 20 crore. The company also highlighted net worth of INR 441 crore, borrowings of INR 72 crore, and a net debt to equity of 0.16x. It referenced a CRISIL BBB+ Stable and A2+ rating reaffirmed in July 2025.

FY26 base business: integrated chain and a branded offtake engine

The presentation positions Scan Steels as an integrated producer across sponge iron, billets and rolling, with two manufacturing locations in Odisha: Rambahal (Unit I) and Gangajal (Unit II). FY26 capacity and utilization disclosed in the deck include 1.5 LTPA DRI at 84 percent utilization, 2.0 LTPA billets at 81 percent utilization, and 2.0 LTPA rolled products at 82 percent utilization. Captive power of 8 MW is shown at 100 percent utilization in FY26.

On the sales side, the company highlighted its branded TMT franchise under the Shrishthi brand and stated that 99 percent of TMT output in FY26 was sold through its own channel as direct dispatch, with 162,469 MT sales referenced. The deck also describes a retailer and wholesaler network where retailers account for nearly two-thirds of sales and wholesalers about one-third.

The presentation included a pricing hierarchy for Odisha that places Scan’s Shrishthi TMT realization at INR 43,430 per tonne in FY26. It also claims a brand premium of INR 1,500 to 2,000 per tonne over unbranded local players.

Financial snapshot table (as presented)

The three-theme roadmap: volume unlock, product mix, then deep integration

Theme 1: billet-led debottlenecking to fully use rolling capacity

The first theme is presented as a constraint removal step. Scan states it has installed 3.0 LTPA rolling capacity but is operating at 2.0 LTPA because billets are constrained. Theme 1 aims to lift billet capacity by 50 percent from 2.0 LTPA to 3.0 LTPA, enabling utilization of the existing 3.0 LTPA TMT capacity. The deck indicates commissioning visibility for September 2026.

It also references hot charging commissioned in FY26 as a cost reduction lever, and the Chairman’s note points to better TMT realizations and hot-charging cost savings in FY26.

Theme 2: downstream value addition via pipes and galvanizing

Theme 2 proposes a new 2.0 LTPA pipe mill and hot-dip galvanizing line, with epoxy coating mentioned as an add-on. The company estimates capex of around INR 80 crore funded through term loan and internal accruals and targets completion by Q3 FY28. The stated demand drivers include national highways, power transmission, water infrastructure and industrial construction.

Theme 3: greenfield backward integration plus 50 MW captive power

Theme 3 is the largest component and the core of the equity ask in the presentation. The project snapshot lists a 12 LTPA pellet plant (wet beneficiation), a 12 LTPA coal washery, a 2.5 LTPA new DRI unit, 1.0 LTPA melting and casting capacity, and 50 MW captive power (WHRS plus thermal). The deck states 100 acres of land is to be allocated by IDCO in Odisha. Estimated capex is about INR 850 crore, with commissioning targeted for Q3 FY31 over a three-year build.

The company positions the project as a margin and resilience lever, citing improved cost control, raw material security, lower energy and logistics costs, and a larger runway for growth.

Funding plan and use of proceeds for the INR 850 crore project

Scan Steels provided an allocation of the INR 850 crore capex program, with 35 percent (INR 300 crore) earmarked for captive power, 29 percent (INR 250 crore) for the pellet plant, 14 percent (INR 120 crore) for the DRI unit, 9 percent (INR 80 crore) for SMS, 5 percent (INR 40 crore) for land and utilities, and 7 percent (INR 60 crore) for working capital and contingency.

For funding, the deck states an equity raise of INR 500 crore (59 percent) and internal accruals of INR 350 crore (41 percent), with nil term debt shown for this project.

Bindals acquisition: an inorganic lever with a March 2028 restart target

Separately, the presentation describes a consortium with Kalinga Allied Industries India Private Limited for acquisition and revival of Bindals Sponge Industries Limited under IBC resolution. The deck states Bindals has a 350 TPD DRI kiln, a 12.5 MW captive power plant, and five induction furnaces of 8 tons to produce 1.00 lakh MTPA of billets.

For financial arrangements, it states SSL infused INR 20 crore and KAII infused INR 20 crore toward the NCLT settlement amount. It also states that further overhaul, renovation and working capital will be funded 50:50 between SSL and KAII. Operations are expected to resume by March 2028.

What the company is projecting to FY31

The presentation provides a Vision 2031 table with management estimates for revenue, EBITDA, PAT and net debt to equity. It shows revenue rising from INR 838 crore in FY26 to INR 4,133 crore in FY31E, EBITDA from INR 49 crore to INR 575 crore, and PAT from INR 20 crore to INR 338 crore. It also lays out a capacity table targeting, by FY31, DRI capacity of 4.0 LTPA, billets 4.0 LTPA, rolling 5.5 LTPA, and pipes and galvanizing 2.0 LTPA, alongside a 58 MW captive power base (8 MW existing plus 50 MW greenfield).

The margin bridge slide attributes an FY31 EBITDA margin of around 13.9 percent to multiple levers, including backward integration, hot charging and yield, operating leverage, and captive power. The power slide compares benchmark power costs of INR 6.80 per kWh for grid, INR 4.00 for coal-based captive, and INR 2.00 for WHRS, and states the captive power build-up to 58 MW by FY31.

Key investor takeaway from the deck

The June 2026 presentation is structured around a clear sequencing: first unlock existing rolling capacity through billet expansion, then move into higher realization downstream products, and finally pursue a large greenfield integration project anchored by pelletization and captive power.

At the same time, the deck makes clear that Theme 3 depends on multiple external conditions including approvals and clearances, and it requires a substantial equity raise. Investors should treat the FY31 figures as management estimates as stated in the presentation, while tracking progress against the disclosed commissioning timelines of September 2026 for Theme 1, Q3 FY28 for Theme 2, and Q3 FY31 for Theme 3.