Profit boost with techno-economic parameters, cost reduction
Steel Authority of India Ltd (SAIL) has reported a 10 per cent increase in net profit to Rs 1,525.12 crore as against Rs 1,386.41 crore in the corresponding previous quarter.
The net sales of the company for the quarter increased 6.2 per cent to Rs 7,731.86 crore as against Rs 7,278.6 crore in the first quarter of 2006-07 fiscal.
Addressing a press conference here on Wednesday, Mr S.K. Roongta, Chairman, SAIL, said, “The company has recorded the best-ever first quarter performance through its continued emphasis on production of value-added steel, improvement in techno-economic parameters, together with several cost reduction measures such as 150 per cent increase in coal production from captive mines.”
The company has also stepped up captive production of iron ore and fluxes to match the higher hot metal production during the quarter. During the quarter, SAIL also undertook some prudent financial management and 28 per cent higher e-sales and e-procurement at Rs 740 crore also helped the company improve the bottom line.
“During the quarter, SAIL achieved a record production of 3.8 million tonnes (mt) of hot metal and 3.4 mt of crude steel with the capacity utilisation of blast furnaces going up to 110 per cent. In regard to techno-economic parameters, improved blast furnace productivity, higher production through continuous casting route and reduction in coke rate were achieved during the quarter,” Mr Roongta said.
He added that major capital repairs were undertaken in the hot strip mills at Bokaro and Rourkela Steel Plants (RSP) along with annual maintenance shutdowns of other critical finishing mills in the first quarter itself.
The company also reduced its overall borrowings by Rs 833 crore during the quarter, bringing its total debt exposure to Rs 3,347 crore. “This has improved the company’s debt-equity ratio to 0.18:1 as on June 30 as compared to 0.24:1 during the end of the last fiscal,” Mr Roongta said.
The board of the company has also given in-principle approval for the modernisation and expansion of Bhilai Steel Plant (BSP) and RSP involving an estimated outlay of over Rs 19,000 crore.
“A proposal for the modernisation of the Durgapur Steel Plant (DSP) has got the inprinciple approval from the board. The plan envisages the plant’s hot metal production capacity to go up to 3.5 mt, with the wheel and axel production to increase post-modernisation of DSP’s share of finished steel to 100 per cent from the current level of around 40 per cent,” Mr Roongta informed.
The company has also initiated the process of getting statutory clearances for the development of Rowghat Iron Ore Mines for BSP to secure availability of critical raw materials like coal and iron ore and progress has been made on this front during the quarter.
Mr Roongta also said that a coking coal block at Sitanala with reserves of over 100 mt was allotted to SAIL and development activities were initiated during the quarter.