The Hindu : Business : `SAIL expansion not mere volume gains'

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Saturday, Sep 23, 2006
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`SAIL expansion not mere volume gains'

Special Correspondent

Hot metal output set to rise to 23 million tonnes

NEW DELHI: The Steel Authority of India Ltd. (SAIL) is set to consolidate its position further in the domestic steel sector on its own strength and the supportive business outlook, SAIL Chairman S. K. Roongta said here on Friday.

Addressing shareholders at the steel major's 34th annual general meeting (AGM) here, Mr Roongta said the ongoing modernisation and expansion programme would take SAIL's hot metal production to 23 million tonnes, an increase of nearly 60 per cent from the current level.

The expansion plans, however, were not aimed at volume gains alone, Mr Roongta pointed out. For, "benefits would come by way of all-round improvement in productivity levels in all areas of operation. Issues pertaining to elimination of technological gaps, energy savings, yield improvement, pollution control and matching infrastructure facilities will be fully addressed,'' he said.

Higher productivity levels, he said, would be ensured by way of wider product-mix with emphasis on value-added products, improved product quality, enhancement in terms of grades and dimensions coupled with the latest automation. With focused efforts towards cost competitiveness and quality improvement and backed by a solid financial foundation and skilled human resources, SAIL was well set on its way to a glorious future, he said.

In keeping with its growth strategy, SAIL already had projects worth Rs. 18,500 crore in various stages of implementation. Some of the major projects approved in recent months included IISCO's plant modernisation and expansion and addition of various facilities at Salem and Durgapur. Many other projects, under SAIL's Rs. 37,000-crore growth plan, were in the final stages of approval, he said.

SAIL, Mr. Roongta said, was also looking at providing greater opportunity for synergy and growth through the merger of Neelanchal Ispat Nigam Ltd. (NINL) and Maharashtra Electrosmelt Ltd. (MEL) with itself. While the merger of NINL would follow on acquisition of its shares, he said the merger of MEL, a subsidiary of SAIL, would result in backward integration by way of manufacture of ferro-alloys, a key material for steel making.

Mr. Roongta also informed the shareholders that SAIL was planning to develop a linkage with new iron ore mines in Chhattisgarh and Jharkhand to gain security in supplies. "This will be crucial for attaining the production targets set in our growth plan,'' he said.

Domestic coking coal

UNI reports:

The Central Government had reserved `F' deposit of Rowghat mines for Bhilai Steel Plant's long-term iron ore requirements and SAIL was moving positively towards obtaining statutory clearances, Mr. Roongta said. Actions had also been initiated to augment availability of indigenous coking coal. "The future strategy for obtaining coking coal from domestic sources will be to develop larger productive coking coal mines so that the base material has a high level of homogeneity,'' the Chairman said.

In reply to a shareholder's query on how SAIL would finance the massive investment plan of over Rs. 9,500 crore for IISCO Steel Plant (ISP), Nilotpal Roy, Managing Director of the plant, said funds would be generated mainly from internal resources.

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