VMS Industries is fundamentally a recycler - it buys end-of-life ocean-going ships, breaks them down at its plot in the world’s largest ship-breaking yard, and sells the high-grade steel scrap and reusable equipment into India’s domestic market. The company began life in 1991 as a management-services firm, but its identity was forged in 2007 when it acquired a ship-breaking plot at Alang-Sosiya in Gujarat and pivoted entirely to ship recycling, a business it has operated since 2009-10. The recurring approach is simple: it buys raw material - old ships - on long international credit, dismantles them with negligible energy use, and sells the output to local buyers who value the metal’s superior physical properties, all while operating from a single leased plot with a lean team of just 40 people. # Business segments Two engines that have now been merged into one integrated line of business - a ship-recycling operation that produces the scrap, and a trading arm that moves it and other metals through a buy-and-deliver model, both reviewed together by the company’s decision-makers as a single unit with common risks and returns. ## 1. Ship recycling: the core manufacturing engine **The company buys old vessels on credit, breaks them at its leased plot in Alang, and sells the resulting re-rollable steel scrap - a product prized by Indian mills because ship-grade steel can be rolled directly into construction bars without first being melted into billets.** - **Raw material bought on long credit** - old ships are purchased from the international market with payment terms of 180 to 360 days, which means the company can acquire a vessel, break it, and sell the scrap before the bill falls due. These purchases expose the company to foreign-exchange risk, and it chooses not to hedge, instead monitoring currency movements and acting when needed. - **A single leased plot is the factory** - all recycling happens at Plot No. 160M in the Alang-Sosiya Ship Breaking Yard, a 2,700-square-metre site leased from the Gujarat Maritime Board. The plot was created by merging two smaller plots in 2007 after a Supreme Court committee required a minimum size, and the lease runs in five-year renewable blocks. - **Steel that mills prefer over virgin metal** - ship-building steel is made to withstand pressure, high impact, and strain at sea, so the scrap has better yield strength, notch-impact strength, and ductility than steel from ingots and billets, with low sulphur and phosphorus and a finer grain structure. India is described as probably the only country that has mastered the technique of re-rolling this scrap directly into construction steel without an intermediate casting step, which gives domestic buyers a cost advantage. - **Everything from the ship gets sold** - the main product is re-rollable scrap, whose price tracks the market rate for iron and steel, but the company also sells recovered equipment, machinery, and other materials. All sales are domestic; the company has reported no foreign-exchange earnings from its output. - **Certified for safe and green breaking** - the company holds ISO 9001, 14001, 45001, and 30000 certifications, plus statements of compliance from RINA and Class NK confirming it meets international guidelines for safe and environmentally sound ship recycling. Energy consumption in the breaking process is negligible, though a solar plant at the plot is being installed. ## 2. Trading and dismantling: the integrated extension **What was once reported as a separate trading segment has now been folded into a single integrated business - the company buys ferrous and non-ferrous metals and dismantles machinery, delivering goods directly from supplier to customer under a bill-to-ship-to model.** - **A pass-through trading model** - the company executes transactions where goods purchased from suppliers are delivered straight to the end buyer, with all payments flowing through proper banking channels. This means the company acts as an intermediary that arranges supply and handles the commercial paperwork without necessarily taking physical possession. - **Machinery dismantling adds a second stream** - the business also dismantles industrial machinery, valuing each piece based on its constituent components and what those parts can be resold for. This sits naturally alongside ship recycling, since both involve breaking down large metal assets into saleable materials. - **Now reviewed as one business** - effective June 2025, the company revised its segment reporting to a single reportable segment called “Manufacturing Iron and Steel Scrap and Trading of It,” because the chief operating decision-maker - the audit committee - now views the entire operation as one integrated line of business with common risks and returns. # Group structure and partners **The company has no subsidiaries or joint ventures, but it holds minority stakes in two partnership firms and has proposed large related-party transactions with entities linked to the promoter family.** - The company is a partner in M/s Eternal Automobiles, a Honda two-wheeler dealership in Bhavnagar, and M/s Yohaan Enterprise in Ahmedabad, which trades and runs a restaurant - in each case with a 10% profit share. - A former subsidiary, VMS TMT Private Limited, ceased to be a subsidiary in 2019-20 and is now a related party in which the company holds an investment measured at fair value. The company has proposed transactions with VMS TMT Limited for sale, purchase, transfer or receipt of products, goods, materials, assets or services worth up to ₹100 crores annually. - A larger proposed arrangement exists with Aditya Ultra Steel Limited - up to ₹500 crores annually for sale, purchase, or transfer of products, goods, materials, assets, or services, all on an arm’s-length basis. The managing director’s son, Varun Jain, is a director of Aditya Ultra Steel Limited. - The promoters and promoter group hold 56.61% of the equity, and the managing director and whole-time director are husband and wife. The company completed a rights issue in May 2024, raising ₹28 crores for long-term working capital and general corporate purposes.