BUSINESS

Tata Steel to hike prices from April 1

MUMBAI, MARCH 24 . Tata Steel will be raising the prices for its long-term contracts by up to 20 per cent that can translate into a hike of Rs. 5,000 a tonne. The hike will be effective from April 1.

Speaking on the sidelines of an extraordinary general meeting (EGM) held here today, B. Muthuraman, Managing Director, Tata Steel, said the company had not raised its prices since July last in spite of a sharp rise in input cost. Long-term contracts account for around 80 per cent of the company's sales volume.

At the EGM, the shareholders approved the company's proposal to raise additional long-term resources of up to Rs. 5,000 crores through various instruments, including foreign currency convertible bonds and equity offerings. They also voted in favour of the company's proposal to raise its borrowing limit from Rs. 5,000 crores to Rs. 10,500 crores.

Ratan Tata, Chairman, Tata Group, said the company had undertaken a study for investments in Bangladesh. The group had evinced interest in setting up fertilizer, power and steel projects in Bangladesh. "Investment plans will be finalised after we complete the study and present it to the Bangladesh Government and they get back,'' said Mr. Tata.

He added that contrary to everyone's perception, "Bangladesh has an excellent track record regarding contractual obligations. On the whole, it is a country that needs to get a start. The sooner India, Pakistan and Bangladesh get moving together, the better it is for the region.''

Speaking on the importance of a steady supply of raw materials like iron ore and coal, Mr. Tata said Tata Steel was looking to own properties overseas for raw materials and not to only source from there. "There will come a time when those in control of raw materials will be kings of this business in the future. There are steel plants all over the world but raw material is not available all over the world.'' Part of the future plans including outside India is to secure raw material requirements, which will grow in the years to come, said Mr. Tata.

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