Essar's flat steel Q1 output up 48%

Essar Steel India Ltd (EStIL) has recorded 48% growth in flat steel production at 1.22 million tonnes in the first quarter of the current fiscal compared to 0.824 million tonnes year ago.

"The total production stood at 1.22 million tonnes (in April-June quarter), compared to 0.824 million tonnes in the corresponding period last year," EStIL said in press release.

The pellet production also grew by 58% to 2.02 MT during the quarter, compared to 1.28 MT in the year ago period.

The liquid steel production too grew at 52% at 1.23 MT in the first quarter of this fiscal compared to 0.81 MT a year ago.

At 78 KT (kilo tonnes), EStIL's PPGI (Pre Painted Galvanised Iron) production was the highest ever in a quarter - up by 55% when compared to 50 KT produced in the corresponding period last year, the company said.

With the ramp up in production volumes since March 2016, there has been a significant growth in the company's EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortisation) margin and a marked improvement in the debt-equity ratio. The EBITDA margin has increased from 5% to around 20% -- an improvement to Rs 6,000-7,000 per tonne.

EStIL's production ramp-up and its positive impact on the financials has been complemented by the introduction of MIP (Minimum Import Price) and BIS standards. Following these measures by the Government of India, Chinese imports of steel at predatory prices has been contained, leading to better sales realisation in the Indian market, the company said.

With the availability of its iron ore mines that were recently acquired, and full production at the Pellet Plant, EStIL is poised to maintain production at high levels, it added.

Essar Steel India is an integrated steel producer with an annual production capability of 10 MT, which is supported by a 20 MT pellet-making capability.