Their business model is to dwarf any steel trader in the Indian Market.
They needed money. As promoters of APL Appolo, they had goodwill in the investor community for their execution prowess. They bought out a non-active or zero-revenue old listed company valued at almost so that they could do a primary capital raise.
Why do u need that much capital. Simple u can do Pan India trading and Value added services. Steel Trading is high value low margins with the largest city based or regional based players at 400 Cr Turnover and 8-10 Cr profits.
Scale has benefits on operational performance, buying price and logistics. But all this is still at embryo stage. Can they execute will be multi billion dollar MCap question.