BS Sponge IPO: Date, DRHP Details and ₹1,000 Crore Issue
Integrated steel maker that turns iron ore into sponge iron and then into billets, TMT bars, wire rods, HR coils and pipes, with its own captive power.
Quick verdict: BS Sponge IPO is at the DRHP stage (filed 30 Sep 2026) and awaits SEBI. Issue size: ₹1,000 cr (₹800 cr fresh + ₹200 cr OFS); ₹650 cr is for debt repayment. FY26 net profit: ₹171.1 cr. Price band: not announced. No Scouter Reading before a price band.
A profitable, growing regional steel maker using the IPO mainly to cut debt, with a small promoter sale. Dates depend on SEBI’s review of the 30 September draft.
Based on SEBI filings and public reports as of 8 November 2026. Not investment advice. Issues without a price band are not given a Scouter Reading.
Where the IPO stands
No IPO date, price band or lot size has been announced as of 8 November 2026.
Data as of 9 November 2026, 01:00 IST. Confirmed = DRHP or SEBI records. Reported = media summaries of the DRHP. Calculated = our arithmetic.
The BS Sponge IPO has no date yet. B.S. Sponge Ltd, a steel maker based in Raigarh, Chhattisgarh, filed its draft red herring prospectus (DRHP) with SEBI on 30 September 2026 for a ₹1,000 crore IPO (Confirmed). It is made up of ₹800 crore of new shares and a ₹200 crore offer for sale by the promoters. Of the fresh money, ₹650 crore is set aside to repay debt. SEBI’s review comes next; the price band, lot size and dates follow only after that.
BS Sponge IPO details
| Total issue | Up to ₹1,000 crore |
| Fresh issue | Up to ₹800 crore |
| Offer for sale | Up to ₹200 crore by promoters |
| Pre-IPO placement | Up to ₹160 crore (reported); would reduce the fresh issue |
| Use of fresh money | ₹650 crore to repay or prepay borrowings; the rest for general corporate purposes |
| Category split | QIB up to 50%, NII at least 15%, retail at least 35% |
| Lead managers | ICICI Securities, Motilal Oswal Investment Advisors |
| Registrar | MUFG Intime India |
| Price band, lot size, dates | Not announced as of 8 November 2026 |
Put together, ₹850 crore of the ₹1,000 crore headline goes to lenders or the promoters, leaving about ₹150 crore, less expenses, for general purposes (Calculated). This is a balance-sheet IPO, not an expansion IPO.
What B.S. Sponge does
B.S. Sponge covers most of the steel chain at its Raigarh operations. It makes sponge iron (directly reduced iron) from iron ore and coal, melts it into billets and slabs, and rolls those into finished products: TMT bars, wire rods, HR coils and ERW pipes, plus ferro alloys (Reported, Business Today). Total capacity across semi-finished and value-added products was 16.28 lakh tonnes a year at March 2026 (Reported), and the plant runs on a 67 MW captive power plant. Its promoters are the Agarwal family, including Parmanand Agarwal, who is chairman.
Chhattisgarh’s Raigarh belt hosts many sponge-iron and secondary-steel producers. The business is volume-driven and sensitive to iron ore, coal and steel prices, and it competes with both large integrated mills and many regional players.
BS Sponge financials
| ₹ crore | FY24 | FY25 | FY26 |
|---|---|---|---|
| Revenue from operations | 1,494.4 | 2,187.8 | 2,592.5 |
| Net profit | 143.9 | 158.4 | 171.1 |
| Net margin | 9.6% | 7.2% | 6.6% |
Revenue has grown fast, up about 46% in FY25 and 18% in FY26, as more downstream capacity came on stream. Profit has grown much more slowly, so net margins have narrowed every year, from about 9.6% to 6.6% (Calculated). That is typical when a steel maker moves into finished products during a period of soft steel prices: more tonnes, thinner spreads. Interest costs on the debt being repaid will also be in that margin, so cutting ₹650 crore of borrowings should help profit directly.
What the ₹650 crore debt repayment could mean for profit
The DRHP summaries do not give the interest rate on the loans being repaid, so here is an illustration only. If those borrowings cost around 9% a year, repaying ₹650 crore would save roughly ₹58 crore of interest before tax, or about ₹44 crore after tax at a 25% rate (Calculated, assumed rate). That would be about a quarter of FY26 profit. The real figure could be higher or lower; the RHP’s section on the objects of the issue lists each loan with its rate, and investors should check it rather than rely on our assumption.
B.S. Sponge cash flow and capacity
B.S. Sponge earns steady profits, but cash flow weakened in FY26. Operating cash flow fell to about ₹144 crore from about ₹301 crore in FY25, even as net profit rose to ₹171.11 crore (Reported, from the DRHP). In addition, free cash flow was negative in all three years because of expansion spending (Reported).
| ₹ crore | FY24 | FY25 | FY26 |
|---|---|---|---|
| Operating EBITDA | 285.08 | 336.59 | 373.01 |
| Net profit | 143.95 | 158.43 | 171.11 |
| Cash from operations | 182.5 | 300.9 | 144.1 |
| Free cash flow | –87.7 | –4.5 | –93.0 |
| Cash from operations / net profit (Calculated) | 1.27x | 1.90x | 0.84x |
The company has grown capacity quickly. Steel capacity rose to 1,627,500 tonnes per annum in FY26 from 735,000 tonnes in FY23, and sponge iron capacity stood at 675,000 tonnes per annum at March 2026 (Reported). Consequently, the IPO is mainly about paying down the debt taken on for that expansion, with ₹650 crore of the ₹800 crore fresh issue earmarked for repayment.
BS Sponge IPO valuation and GMP
No valuation, price band or GMP exists yet. When terms are set, the useful comparisons are listed secondary-steel and sponge-iron makers, using price to earnings and enterprise value to EBITDA, since debt will still be meaningful after the IPO. Any grey-market figure before a price band is not linked to a real offer; see what IPO GMP means.
BS Sponge IPO review: strengths and risks
Strengths
- Integrated from sponge iron to finished steel, with captive power to control energy costs.
- Consistently profitable, with revenue up about 73% over two years.
- Most of the fresh money cuts debt, which should lower interest costs.
Risks
- Shrinking margins: profit has grown far more slowly than revenue for two years.
- Commodity cycle: steel, iron ore and coal prices drive results, and the company has little pricing power.
- Little growth capital: almost nothing in the fresh issue funds new capacity.
- Regional concentration: a single operating base in Raigarh.
- Environmental rules: coal-based sponge iron faces tightening emission norms.
What happens next
- SEBI’s observations on the 30 September draft.
- Any pre-IPO placement of up to ₹160 crore.
- The RHP with the price band, lot size and dates. We will update this page then; see IPOs with confirmed dates meanwhile.
BS Sponge IPO: frequently asked questions
When is the BS Sponge IPO date?
Not announced as of 8 November 2026. B.S. Sponge filed its DRHP on 30 September 2026; dates will follow SEBI’s observations and a red herring prospectus.
What is the BS Sponge IPO size?
Up to ₹1,000 crore: a fresh issue of ₹800 crore and an offer for sale of ₹200 crore by the promoters.
What will B.S. Sponge do with the IPO money?
₹650 crore of the fresh issue is earmarked for repaying borrowings, with the rest for general corporate purposes. The OFS money goes to the promoters.
Who are the lead managers for the BS Sponge IPO?
ICICI Securities and Motilal Oswal Investment Advisors, with MUFG Intime India as registrar.
Is B.S. Sponge profitable?
Yes. Net profit was ₹171.11 crore in FY26 and ₹158.43 crore in FY25, on revenue of ₹2,592.52 crore and ₹2,187.82 crore (Reported, from the DRHP).
What does B.S. Sponge make?
Sponge iron and steel products from semi-finished billets to finished goods such as TMT bars and hot-rolled coils, with steel capacity of 1,627,500 tonnes a year.
Why did B.S. Sponge’s cash flow fall in FY26?
Operating cash flow fell to about ₹144 crore from about ₹301 crore, as more money went into working capital. The RHP should explain the drivers in detail.
What is the retail quota in the B.S. Sponge IPO?
The DRHP reserves 35% of the offer for retail investors, 15% for non-institutional investors and 50% for qualified institutional buyers (Reported).
Sources: SEBI public issue filings (B.S. Sponge DRHP) · Business Today · PTI via HDFC Sky · FinTech BizNews · Trendlyne
Disclaimer: This article is for information and education only and is not investment advice. Draft terms can change in the red herring prospectus.
