“We have already empaneled suppliers for engineering goods exports. They are expected to take off from Q1 of next fiscal. Engineering goods will be primarily exported to African markets. We have also identified some Asian markets like Sri Lanka and Bangladesh”, said a senior MMTC executive.
MMTC is awaiting award of drug license to start exports of pharmaceutical products. Amongst the new products identified for trade, minor minerals are targeted for exports alone and will be canalised through MMTC. The other identified commodities are meant for two-way trade. Turnover projections on the new commodities are yet to be done as their trade is still at an incipient stage. MMTC's plan to foray into the new commodities stems from the considerable trading activities happening globally.
The company has initiated action on exports of minor minerals like feldspar and bentonite. Historically known for its strengths in trade of bulk minerals like iron ore and chrome ore, MMTC is witnessing a downtrend in exports of these minerals in value and volume terms. In FY18, low grade chrome ore and chrome concentrates exports plunged 58 per cent as a steep export tax of 30 per cent weighed on exports. Total volumes exported in last fiscal were only 95,000 tonnes, down from 225,000 tonnes shipped in FY17.
MMTC is one of the premier bullion traders in the country with the precious metals division contributing significantly to its turnover. During 2016-17, the precious metals group contributed nearly 50 per cent to MMTC's gross turnover despite high volatility in bullion prices. In 2016-17, the trading company had a share of two per cent in gold and 12 per cent in silver in the country's bullion trade. MMTC's turnover in FY17 included gold and silver imports valued at Rs 48.74 billion and domestic trade worth Rs 11.64 billion.
The company has delineated a roadmap to double its topline in the next five years. The surge in turnover is expected to be fuelled by MMTC’s diversification into the new potential business areas. MMTC is eyeing Rs 170 billion turnover in this financial year with a targeted net profit of Rs 550 million. Last fiscal, the trading company logged Rs 3.75 billion in consolidated net profit, recovering dramatically from Rs 2.97 net loss it bled in 2016-17.