JSW Steel eyes 15 million tonne sales in FY17

The company also completed very low-cost and returns-accretive capacity expansion projects at Vijayanagar, Dolvi and Salem

JSW Steel is eyeing sales of 15 million tonnes (Mt) as well as a production of 15.75 Mt per annum (mtpa) in the current financial year.

In his speech to the company shareholders on Tuesday, JSW Steel Chairman and Managing Director Sajjan Jindal said the firm continues to be confident of the India story.

Following the ramp-up of new facilities, JSW Steel will be well positioned to deliver around 25% growth in volumes in the coming year, he said.

"With a target of crude steel production of 15.75 mtpa and saleable steel sales of 15 mtpa in 2016-17, we are also aiming to reduce our cost of production even further, with economies of scale and consistent focus on efficiency improvement. We look forward to consolidating your company's leading position in the industry in the year ahead," he added.

On capacity expansion, Jindal said the firm completed a few very low-cost and returns-accretive capacity expansion projects at Vijayanagar, Dolvi and Salem in 2015-16.

"This has resulted in a 25% enhancement in capacity to 18 mtpa. This expansion has also enabled us to enhance the proportion of long products in our portfolio, well in time to capitalise on the upswing in infrastructure creation and construction activity," he noted.

He said despite temporary challenges, India's long-term outlook for the steel sector continues to be bright.

Government aims to scale up the country's steel production to 300 Mt by 2025 and is taking relevant steps to bolster the growth of the sector.

Citing examples, Jindal said in the Budget 2016-17, the government has proposed to spend Rs 2.18 lakh crore on roads and railways.

In addition, India's automobile industry witnessed a rebound in demand among emerging economies. Such a scenario augurs well for the domestic steel sector, he added.

"Other initiatives of the government such as Housing for All by 2022, Power for All by 2019, 100 Smart Cities by 2022 and Atal Mission for Rejuvenation & Urban Transformation (AMRUT) are likely to drive steel demand significantly," he noted.

On JSW Steel's focus areas, Jindal said: "The major focus this year (2015-16) was to stabilise and sustain international standards in electrical steel products. The company aims to increase sales of these value added products in the year 2016-17."

JSW Steel has a strategic and technical collaboration with JFE Steel Corporation with focus on customer approvals and commercialisation of the auto grade steel (advanced CRCA and galvanised).

Under the collaboration, it has set up a 0.2 mtpa state -of-the-art Annealing and Coating Line (ACL) for production of fully-processed Non-Grain Oriented electrical steel grades.