29% increase in turnover
Record saleable steel production; 9% growth
30% higher record sales
Further reduction in borrowing
Rs. 9,592 crore mega expansion plan approved for IISCO Steel Pant
Steel Authority of India Ltd (SAIL) once again achieved record-breaking performance in the first quarter of the current financial year. The unaudited financial results for April-June 2006, taken on record by the company’s Board of Directors here today, showed a profit after tax (PAT) of Rs. 1,386 crore, a 23% increase over the same period last year. This is the highest PAT achieved by SAIL in any Q1. At Rs. 8,412 crore, the sales turnover of the company was also 29% higher than that of the first three months of 2005-06.
The improved financial performance was achieved despite a 27% increase in price of imported coking coal in Q1 of the current financial year over CPLY. Prices of other metallic inputs like zinc and aluminium, too, were very high.
Strong market pull, however, led to record saleable steel production of 3.1 million tonnes (9% growth) and sales of 2.45 million tonnes (30% growth). Production through concast increased by 7% over CPLY, taking concast component to 61% of crude steel produced. Thrust on production saw a growth of 23% in bars & rods, 10% in HR coils/skelp, and 8% in CR coils/sheets, galvanised products and plate mill plates.
Continuing with its status as a virtual debt-free company, SAIL reduced its borrowings from Rs. 4,298 crore as on 31.3.06 to Rs. 4,000 crore on 30.6.06. The company’s interest outgo during Q1 this year, too, was substantially lower at Rs. 94 crore.
Further improvement in techno-economic parameters led to better operational efficiencies during the period as well. Energy consumption and coke rate were lower than the corresponding period last year at 7.22 giga calories per tonne of crude steel and 542 kg per tonne of hot metal, respectively, while blast furnace productivity rose from 1.46 tonnes/cu.m./day last year to 1.48 tonnes/cu.m./day.
Manpower in SAIL reached a figure of 137,121 on 30.6.06, following a reduction of 1,090 through natural and voluntary separations during April-June 2006.
The SAIL Board also gave in-principle approval to six projects involving a total expenditure of over Rs. 11,000 crore today. Leading the list is a proposal for expansion of IISCO Steel Plant (ISP) at Rs. 9,592 crore, incorporating latest technologies. Major facilities to be installed as part of the project include a 7-metre-tall coke oven battery, two 204 sq.m. sinter machines, new blast furnace of 4,600 cu.m. capacity, three 150-tonne converters, two 6-strand billet casters and one 4-strand beam blank/bloom caster, new universal section mill of 0.6 million tonne capacity and a new wire rod & bar mill of 1.2 million tonne capacity.
The SAIL Board also approved installation of a 0.7 MTPA bar & rod mill for Durgapur Steel Plant (DSP) at an estimated cost of Rs. 738 crore. Besides giving much-needed variety to DSP’s product-mix, the proposed mill will help to enhance the plant’s finished steel output from the present level of around 45% to over 75%. With capacity to produce bars and rods in the range of 5.5 mm dia to 40 mm dia, the mill will be able to offer a complete package for the construction segment. State-of-the-art technology for stringent quality control, proper material identification with modern handling and packaging facilities will provide a competitive edge.
Upgradation of Blast Furnace (BF) # 1 and rebuilding of Coke Oven Battery (COB) # 1 of Bokaro Steel Plant (BSL) have also been given the green signal. Cost of upgrading BF # 1 has been estimated at around Rs. 593 crore.
Projects worth nearly Rs. 6,000 crore are currently being executed in the SAIL plants and mines. The company has laid a thrust on capex in order to achieve its new target of producing 22.5 million tonnes of hot metal in about 4 years.