Steel Authority of India Limited (SAIL) Chairman and Managing Director S. K. Roongta on Friday indicated that the company was open to joining hands with NMDC for setting up a steel plant in Karnataka, primarily catering to sectors such as automobile and consumer durables.
“If NMDC is looking for partners, particularly among PSUs, we will definitely look to engage ourselves with them,” Mr. Roongta told reporters here after the annual meeting. NMDC, the largest iron ore miner, has proposed the setting up a five million tonnes per annum steel plant in a joint-venture format. However, the proposal is still at a nascent stage.
The two PSUs had recently agreed to jointly develop limestone mines in Himachal Pradesh. SAIL’s call for partnering NMDC hints at a shift in the business strategy of local producers as it comes close on the heels of the entry of global steel giant ArcelorMittal in India in partnership with galvanised steel maker Uttam Galva.
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Mr. Roongta said SAIL would take its overall capacity for value-added steel products to close to three million tonnes per annum (mtpa) in the next two years. “We will commission the state-of-the-art 1.2 mtpa cold-rolled steel mills in Bokaro in mid-2011. Coupled with our present capacity at Rourkela and Bokaro steel plants, the company’s overall capacity to produce such items would be 2.7 mtap,” he added.
Such products help the company resist the pressure caused by the slump in offtake amid economic crisis, he said, adding that their demand was still seen rising.
However, to remain competitive at a time when the markets were still recovering, Mr. Roongta said a slew of cost-cutting measures would be undertaken in the fiscal to save up to Rs. 1,000 crore. He said he expected prices as well as demand for its products to increase in the coming quarters following firming global trends. The company said expansion programmes at all its plants are going on a full swing.
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