You are here » Home » Companies » Company Overview » Steel Authority of India Ltd

Steel Authority of India Ltd.

BSE: 500113 Sector: Metals & Mining
NSE: SAIL ISIN Code: INE114A01011
BSE 00:00 | 26 Apr 75.95 -1.75
(-2.25%)
OPEN

77.70

HIGH

78.20

LOW

75.50

NSE 00:00 | 26 Apr 75.95 -1.60
(-2.06%)
OPEN

77.35

HIGH

78.15

LOW

75.40

OPEN 77.70
PREVIOUS CLOSE 77.70
VOLUME 609896
52-Week high 101.40
52-Week low 53.00
P/E
Mkt Cap.(Rs cr) 31,371
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 77.70
CLOSE 77.70
VOLUME 609896
52-Week high 101.40
52-Week low 53.00
P/E
Mkt Cap.(Rs cr) 31,371
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Steel Authority of India Ltd. (SAIL) - Chairman Speech

Company chairman speech

Letter to Shareholders

Dear Shareholders

I am privileged to address you once again and apprise you about the achievements ofyour Company in the financial year 2016-17.

The World economic recovery is on track and a pickup in Global growth presents ahealthy sign for industrial and manufacturing activities across globe. With Global outputas projected by IMF to grow by 3.5% in 2017 and 3.6% in 2018 on the back of betterperforming emerging economies we expect more stability in the steel industry world-wide.

Meanwhile India is projected to become the world's fifth largest economy in 2017surpassing UK and France and the world's third largest economy by 2023 surpassing Japanand Germany. India's GDP is projected to rise from USD 2.2 trillion in 2016 to USD 3.6trillion by 2020. This augurs well for businesses that are focused on domestic growth inthe future.

With suitable trade measures put in place by the Government of India for providing alevel playing field to the domestic steel producers the Indian steel industry couldperform as per its potential and India became a net exporter of steel in FY 2016-17.

Given the current stage of development of the Indian economy and the likely growth pathfor the Country's economy in the next decade the steel demand in India will witnesssignificant growth in future. India with its stable government strong reforms risinginfrastructure spend & robust consumption demand will provide a platform to reach percapita steel consumption of 160 kg & total steel capacity of 300 Million tonnes by2030-31 as envisaged by National Steel Policy 2017.

Your Company achieved a turnover of '49180 crore during 2016-17 which is higher by14% over previous year due to increase in both sales volume (8%) as well as Net SalesRealisation (NSR) of Saleable Steel of five Integrated Steel Plants by about 6%. Theincrease in NSR was partly due to an overall improvement in price levels and partly due tomeasures in enriching Company's product mix. Your Company's intensive focus on improvingoperational parameters resulted in positive EBITDA in all four quarters of FY 2016-17 andyour Company trimmed losses by 30% by recording an overall improvement in productionsales and efficiency.

As far as production performance is concerned SAIL achieved highest ever Hot Metalproduction at 15.73 Million Tonnes (MT) Crude Steel production at 14.50 MT and SaleableSteel production at 13.87 MT during FY 2016-17. There were allround improvements in themajor techno-economic parameters.

The unprecedented increase in coal prices during FY2016-17 however adversely impactedthe cost of production and overall margins. During the year there was an additionalimpact of around ' 4300 Crore as compared to FY 2015-16 on account of increase in pricesof both imported and domestic coal. This increase in coal prices neutralized thesignificant improvement in Net Sales Realization (NSR). Notwithstanding the increase incoal price your Company could reduce its operational expenditure per ton of saleablesteel by 2% during the fiscal.

Your Company has almost completed its Modernization and Expansion Programme (MEP). Thestate-of-the-art New Universal Rail Mill at Bhilai Steel Plant (BSP) was inaugurated byHon'ble Steel Minister in January'17. This mill produces World's longest single piece railof 130 meters length and supplies welded 260 mts rail panels to the Indian Railways. Withthis capacity addition BSP has the record of being the single largest rail producingfacility at one location in the World.

The already operational new facilities under the Modernization and Expansion plan wereramped up during the year. New Blast Furnace at Rourkela Steel Plant (RSP) achieved about100% of its capacity whereas other facilities like the New Plate Mill also produced nearto their rated capacities. The New 3 MTPA Hot Strip Mill at RSP is also scheduled to beinstalled by 2018 and this will enlarge the basket of the value added products.. The newfacilities at IISCO Steel Plant (ISP) have also been ramped up significantly. The Wire RodMill of ISP will be soon producing world class Wire rods in special grades to meet therequirement of the Indian and Global Steel industries.

There has been significant value addition in the product mix of the Company withhigher grades of steel like API X-70 from RSP's New Plate Mill for the oil & gassector SAIL HT-600 for the automotive sector and high strength LPG steel grade fromBokaro Steel Plant etc. Continuous product development efforts are being made withintensive R&D efforts especially from the new state of the art mills commissionedunder the Modernisation and Expansion Plan. Amongst the Indian steel producers yourcompany continues to be in the forefront in R&D with the highest spending.

The products being manufactured by our new rolling mills have been received well by thecustomers and it is our constant endeavor to add more and more value added grades fromthese mills. Products from the RSP NPM and BSL CRM-3 are being well received in exportmarkets too. In conjunction with increased production focus is being given to efficientand strategic marketing for improving sales and realisations. More emphasis is being givenon last mile connectivity with the end users marketing in regions where we have naturalfreight advantage increasing retail & rural sales and leveraging the brand image ofSAIL.

We have launched a Companywide initiative with the help of Boston Consulting Group(BCG) named 'SAIL Uday' for improving our all-round performance. Cross functional teamsacross plants units and marketing have been formed and both short and long term actionplans have been formulated. Implementation of various initiatives is already underway andmany benefits are expected to come in this fiscal itself.

Your Company continued its efforts of conducting operations in an environmentallyresponsible manner. These have resulted in reduction of emissions and discharge levelsincrease in utilization of solid wastes and green cover. Our efforts to plant more treescontinued during this year too.

Finally I would like to take this opportunity to thank you as the shareholders of theCompany for your constant support and trust. I would also like to thank our customerssuppliers the Central and the State Governments and our employees who have always stoodby the Company and I look forward for their continued support in the future.

(RK Singh)

Chairman

Place: New Delhi

Dated: 11th August 2017