Durgapur Steel Plant Sets Ambitious Production Targets

The Durgapur Steel Plant (DSP) has stressed peak level performance and cost control measures at all points to manage finances effectively and generate a sizeable surplus.

The plant, fresh from the Rs 4,500 crore modernisation, has set an ambitious production target of 2 million tonnes of hot metal in 1997-98 against 1.49 million tonnes in 1996-97. Production target of crude and finished steel was kept at 1.8 mt and 1.55 mt during the year.

Plant managing director S B Singh in a note circulated to all departments in the new financial year said that the plant should perform at peak levels. Efforts should be made to go in for target fulfilment in all departments right from the beginning.

 

There was no option left but to fulfil the targets, he said admitting that DSP was in the midst of difficult financial situation and the plant should look for opportunities to earn more revenue and consolidate gains.

In the last three years, he said, the plant had recorded fairly high gross margin which was a distinct and positive break from the past. But DSP has to maximise its gross margin to cover interest and depreciation burdens.

The losses of DSP were made up with funds from outside but such funds were no longer available. The plant was also not getting any budgetary support for several years, he said.

Stressing that DSP must stand on its own, Singh said the shareholders, including the government, looked forward to decent returns for the money invested. Huge investments were made for the modernisation of the plant and SAIL now needed money to update its other plants in order to be globally competitive.

Although the market for steel in general was sluggish, there was no dearth of orders for DSPs products. All our production should be market-oriented and we have to ensure proper quality and timely delivery and a more buoyant market situation would ensure better returns for its products.

DSPs performance, he said, had been declining all along excepting for a period in the early 60s and a short span in the mid 70s. Its performance had reached the rock bottom during 1993-94.

With the commissioning of the modernised units, the production picked up steadily in all areas. DSP now aimed at achieving full post-modernisation rated capacity in 1997-98 after the achievement of over 80 per cent of the post-modernisation rated capacity in the last quarter of 1996-97.

DSP sources said that the hot metal production at 1.49 mt in the just-concluded financial year surpassed its previous best achievement of 1.31 mt during 1964-65. Similarly, the production of 1.25 mt of crude steel and 1.09 mt of saleable steel was much higher than the previous achievement.

These achievements were inspite of the production setback in the earlier part of 1996-97 due to a delay in the commissioning of the blast furnace No-4 and coke over battery No-3, the sources added.