Professional Documents
Culture Documents
Sr
No
1
1.1
1.2
1.3
1.4
1.5
2
2.1
2.2
2.3
2.4
3
3.1
3.2
3.3
3.4
3.5
3.6
Contents
Introduction
steel industry in India
1.1.1 List of Major Iron and Steel producing companies in
India
1.1.2 List of major Iron and Steel units of SAIL
1.1.3 Types of existing Iron & Steel Plants in India
History of steel
objective of the study
Scope & limitation of reason of price
Methodologies
Growth and Evolution
Product Profile
2.1.1 Growth
Innovation Potential
2.2.1 Indian steel potential
2.2.2 Industrial production and GDP are recovering.
2.2.3 Technological innovation
Economic
2.3.1 Global scenario
2.3.2 Domestic scenario
2.3.3 Production
Industrial Trade Policy
2.4.1 The new industry Policy
2.4.2 The growth profile
Demand analysis
Demand determination
3.1.1 Demand - Availability Projection
3.1.2 Raw Materials:
3.1.3 Infrastructure
3.1.4 Investments
Steel Prices
Income
3.3.1 Estimates at current price
3.3.1.1 Gross Domestic Product
3.3.1.2 National Income
3.3.1.3 Per Capita Income
Penetration
Replacement demand
Products
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no
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3.7
3.8
4
4.1
4.2
4.3
4.4
4.5
4.6
4.7
4.8
4.9
4.1
0
4.1
1
4.1
2
4.1
3
4.1
4
4.1
5
4.16
5
5.1
5.2
37
37
40
41
42
43
44
46
47
47
47
49
51
Market share
55
Logistic demand
55
56
56
56
56
Financial Analysis
Profit Margin Analysis
5.1.1 Gross Profit margin Analysis
5.1.2 Net Profit Margin
Leverage Analysis
5.2.1 Total Debt ratio
5.2.2 Debt equity ratio
5.2.3 Capital equity ratio
60
60
61
62
62
63
64
49
50
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5.3
5.4
5.5
5.6
5.7
6
6.1
6.2
6.3
7
8
9
Profitability Analysis
5.3.1 Operating margin
5.3.2 Return on net worth
Du Pont Analysis
ROE
EPS
DPS (dividend per share)
Strategic analysis of steel industries
SWOT Analysis Of The Steel Industry
6.1.1 Strengths
6.1.2 Weaknesses
6.1.3 Opportunities
6.1.4 Threats/Challenges
PESTEL Analysis Of The Steel Industry
6.2.1 Political analysis
6.2.2 Economical analysis
6.2.3 Socio Culture analysis
6.2.4 Technical analysis
6.2.5 Environmental analysis
6.2.6 legal analysis
Porters five force model
Futuristic scenario of the industry
Conclusion
Bibliography
65
65
66
67
68
69
70
72
72
72
72
72
73
74
74
75
75
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76
78
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Chapter 1
Introduction
1. Introduction
1.1. Steel Industry in India
Steel is traditionally considered the backbone of national economic
development. It is a major input into sectors which support economic growth
such as infrastructure, machinery, power and railways, as well as being
important for fast growing sectors, in particular automobiles and consumer
durables.
The steel industry in India is currently at an inflexion point brought about by
ambitious capacity expansion plans, entry of new players and increased
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cannot be carried out solely on the basis of this report. This report
conducts the overall macro view of the Indian steel industry and any
products or subsidiary industries or related issues are not considered.
Report covers the Indian steel industry with global perspective but the
dynamics of global steel industry ls out of the scope of the study.
1.5methodologies
The following methodology was adopted
Literature survey
Market analysis in India with use of specific secondary data and
relevant comparison to the world developments
Development of strategy for batter distribution of electricity
Literature survey
For formulating marketing strategy, it is imperative to understand the
concepts of marketing management with specific reference to industrial
product. It is also necessary to steel production can be considered as
industrial product.it is also necessary to understand the concepts of strategic
management with particular reference to marketing strategy. Also it is an
essential requirement, to understand the concepts of strategic management
with particular reference to marketing strategy. The literature survey was
carried out by reviewing the books and articles of renowned authors to build
up the framework for formulation of marketing strategy for providing turnkey
solutions for steel production.
Market analysis
The analysis involved
The study of environment
Estimation of plan investment and likely impact in terms of products
and services
Data collection from secondary sources.
Secondary data collection has been done by referring steel authority of
India figures and compilation of Notice information Tenders (NITs)
published in last six months.
In order to understand the actual requirement of the customer, data
collection has been linked with the objective of the study in each step.
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Chapter : 2
Growth and Evolution
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India largely imports its coking coal requirement from Australia. As per the
Bureau of Resources and Energy Economics, Australia, worlds metallurgical
coal prices are expected to decline by 5.5 per cent to average at USD 150
per tone for the year 2014. Production from a number of new and expanded
mines that have been commissioned recently, such as BMAs Daunia and Rio
Tinto and Mitsuis Kestrel mines in Australia, are expected to increase the
countrys coking coal output.
India is estimated to have turned net exporter of steel in 2013-14. It is likely
to maintain the momentum in 2014-15 as producers are contemplating
increasing exports against the backdrop of huge capacity additions and
moderate growth in consumption. Indias steel exports are expected to be
around 9.3 mt in 2014-15, as against imports of 6.5 mt.
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The Indian steel industry has entered into a new development stage
from 2007-08, riding high on the resurgent economy and rising
demand for steel.
As per the report of the Working Group on Steel for the 12 th Five Year
Plan, there exist many factors which carry the potential of raising the
per capita steel consumption in the country. These include among
others, an estimated infrastructure investment of nearly a trillion
dollars, a projected growth of manufacturing from current 8% to 1112%, increase in urban population to 600 million by 2030 from the
current level of 400 million, emergence of the rural market for steel
currently consuming around 10 kg per annum buoyed by projects like
Bharat Nirman, Pradhan Mantri Gram Sadak Yojana, Rajiv Gandhi
Awaas Yojana among others.
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At the time of its release, the National Steel Policy 2005 had envisaged
steel production to reach 110 million tonnes (mt) by 2019-20.
However, based on the assessment of the current ongoing projects,
both in Greenfield and Brownfield, the Working Group on Steel for the
12th Five Year Plan has projected that domestic crude steel capacity in
the county is likely to be 140mt by 2016-17 and has the potential to
reach 14mt if all requirements are adequately met.
2.3.3 Production
In 2014-15, production for sale of total finished steel (alloy + non alloy)
was 91.46mt, a growth of 4.3% over 2013-14.
Production for sale of Pig Iron in 2014-15 was 9.7mt, a growth of 22%
over 2013-14.
India is the largest producer of sponge iron in the world with the coal
based route accounting for 90% of total sponge iron production in the
country.
Sources: steel.gov.in
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Chapter: 3
Demand Analysis
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Ch 3 Demand Analysis:
3.1 Demand determination:
3.1.1 Demand - Availability Projection
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Explanation:
(i) In a deregulated environment, it is difficult to forecast capacity creation,
especially in the private sector. Further, capacity creation is sensitive to
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consisting of RINL, NMDC, CIL and NTPC to achieve the above objective has
not made much progress so far but it is imperative to make this venture
more effective.17In view of the limited availability of coking coal in the global
market and the fact that its supply is controlled by a few large companies, it
will be extremely important to increase the domestic production of coking
coal and upgrade its quality to meet the requirements of steel making.
Technologies which require less of coking coal and lower grades of it will
need to be encouraged. Non-coking coal used for production of sponge iron
is also increasingly becoming scarce in the country. With the demand for
non-coking coal from priority sectors like power, Fertilizers etc. going up
further, its availability for steel making is likely to be limited during the
12thplan. While sponge iron producers may opt for import of coal, the
economic viability of this sector may be under pressure due to higher prices
of imported coal. Moreover, the gas based DRI units face restricted supply of
CNG, largely due to priority allocation of gas to power and fertilizer sectors.
Supply of CNG to this sector is a major concern for its growth and these units
may have to depend more on imported source of fuel supply. Many existing
and new producers propose to create additional capacity manifold under gas
based route in Twelfth plan period.
3.1.3 Infrastructure:
Development and growth of Infrastructure sector is critical for rapid growth
of domestic steel industry in the country. Steel industry is a major user of
infrastructural facilities especially of Railways, roads, power, and ports.
Besides, the competitiveness of domestic steel industry depends heavily on
the expansion and provision of efficient infrastructural facilities. As per the
working group projections, the steel production in the country will nearly
double within the next five years. This requires rapid growth of railways,
roads, ports and power facilities. The existing infrastructural facilities are not
adequate. The domestic steel industry meets 70% of its coking coal
requirement from imported sources and if the same trend is maintained,
nearly 50 million tones of coking coal will have to be imported by 2016-17.
There is urgent need for expansion of port capacity to handle the raw
materials and finished goods of steel sector. The steel plants which are likely
to come on stream in Twelfth plan period will need to transport 85 to 90
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million tons of iron ore from the mines and also deliver 45 to 50 million tones
of finished steel from steel plants to distribution centers. Therefore, there is
immediate need for substantial up gradation of infrastructural facilities to
meet the increasing steel requirements of the steel industry. Investments to
the tune of US $ 1 Trillion are proposed in the infrastructure sector in the
12thplan. An investment of this scale and size is likely to generate higher
domestic demand for steel and at the same time help build necessary
infrastructure required for the steel industry. Large investments of this nature
suffer from gestation lags, constraints in mobilization of financial resources,
land acquisition issues and hurdles in obtaining statutory clearances in case
of mega infrastructural projects. These need to be sorted out since the
development of infrastructure sector has strong forward and backward
linkages and contributes significantly to overall growth and development of
the economy.
3.1.4 Investment:
Requirement of financial resources to support an additional capacity creation
of about 60 million will be approximately 2.5 lakh crores during the 12 thPlan
and securing such large investible funds at reasonable cost will be a
challenging task. FDI in the steel sector has been lagging behind, despite
massive investment intentions by some major global steel majors. In order to
ensure sufficient availability of financial resources for the growth of Indian
steel industry, it is imperative to review steel related sectorial caps of the
banking sector. Government may also consider easing of norms connected
with external borrowings (ECBs). Special purpose long term financing facility
may be created to finance huge investment in new steel plants.
Price regulation of iron & steel was abolished on 16.1.1992. Since then
steel prices are determined by the interplay of market forces.
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For ensuring quality of steel several items have been brought under a
quality control order issued by the Government.
We, like many other steel service centers, maintain substantial inventories of
steel to accommodate the short lead times and just-in-time delivery
requirements of our customers. Accordingly, we purchase steel in an effort to
maintain our inventory at levels that we believe to be appropriate to satisfy
the anticipated needs of our customers based upon historic buying practices,
contracts with customers and market conditions. Our commitments to
purchase steel are generally at prevailing market prices in effect at the time
we place our orders. We have no long-term, fixed-price steel purchase
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Year
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
China
Price
81
81.6
81
81.9
85.1
86.6
87.9
92.1
97.5
96.8
100
105.4
Japan
Price
102.7
101.9
100.5
100.7
100.7
100.4
100.7
100.7
102.1
100.7
100
99.7
Usa
Price
79
81.2
82.5
84.5
86.6
89.6
92.4
95.1
98.7
98.4
100
103.2
2012
2013
2014
108.2
111.1
113.3
99.7
100
102.8
105.3
106.8
108.6
Sources:
India
Price
54.2
56.2
58.6
60.9
63.1
65.8
69.9
74.3
80.5
89.3
100
108.0
9
119
132
140.4
http://data.worldbank.org/indicator/FP.CPI.TOTL
3.3 Income:
3.3.1 ESTIMATES AT CURRENT PRICES
3.3.1.1 Gross Domestic Product
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GDP at current prices in the year 2014-15 is likely to attain a level of `126.54
lakh crore, showing a growth rate of 11.5 per cent over the year 2013-14
of `113.45 lakh crore (First revised estimate with the growth rate of 13.6
percent).
3.3.1.2 National Income
The nominal Net National Income (NNI), also known as national income (at
current prices) is likely to be `112.18 lakh crore during 2014-15, as
against `100.56lakh crore for the year 2013-14. In terms of growth rates, the
national income registered a growth rate of 11.5per cent in 2014-15 as
against the previous years growth rate of 13.7 per cent.
3.3.1.3 Per Capita Income
The per capita net national income during 2014-15 is estimated to
be `88,538 showing a rise of 10.1 percent as compared to `80,388 during
2013-14 with the growth rate of 12.3 percent.
3.4 Penetration:
The degree to which a product has been accepted by the marketplace. The
output of the market planning process. The market plan includes the current
market position, opportunity and issue analysis, marketing objectives and
strategies, action plans, programs, projects, budgets, and pro forma profit
and loss statement and management controls. Syn: brand plan, product plan.
The process of developing market plans for products and services. This
process is composed of the following phases-identification; research and
analysis of market opportunities; selection of target markets; development of
marketing strategies; development of the marketing plans, programs, and
projects; and management, execution, and control of the market plans,
programs, and projects.
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the reversal of the trend will be an increasingly stronger challenge and the
resources required to bring in the change will also be significant. Whether
the steel industry can see that happen quickly is a matter to be analyzed.
Indian Steel industry has shown the second highest growth rate for steel
production in Asia after China in 2006. With a GDP growth of around 8% in
2005-06, Indian economy as well as the industrial development got a boost
and this helped to shape the increasing steel demand and production in
India. The report "Opportunities in Indian Steel Industry by RNCOS
undertakes a detailed analysis of the forces that have shaped the Indian
steel industry in order to predict the future trends and prospects.
3.5 Replacement demand:
A demand representing replacement of items consumed or worn out.
Replacement demand is an important component of the future demand for
manpower often neglected in manpower demand forecasts. In particular, for
characterizing the prospects for newcomers on the labor market, the
manpower requirements method is not adequate as it merely focuses on
employment mutations.
3.6 products:
3.6.1 steel pipes:
Steel pipes are long, hollow tubes that are used for a variety of purposes.
They are produced by two distinct methods which result in either
a welded or seamless pipe. In both methods, raw steel is first cast into a
more workable starting form. It is then made into a pipe by stretching the
steel out into a seamless tube or forcing the edges together and sealing
them with a weld. The first methods for producing steel pipe were introduced
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in the early 1800s, and they have steadily evolved into the modern
processes we use today. Each year, millions of tons of steel pipe are
produced. Its versatility makes it the most often used product produced by
the steel industry.
Steel pipes are found in a variety of places. Since they are strong, they are
used underground for transporting water and gas throughout cities and
towns. They are also employed in construction to protect electrical wires.
While steel pipes are strong, they can also be lightweight. This makes them
perfect for use in bicycle frame manufacture. Other places they find utility is
in automobiles, refrigeration units, heating and plumbing systems, flagpoles,
street lamps, and medicine to name a few.
SSF are the leading manufacturer of high integrity special fasteners (e.g.
bolts, set screws, stud-bolts, nuts and washers), meeting clients exacting
demands for critical applications in hostile environments. Whether for
offshore (buoyancy and petrochemical), seawater, pump, valve or nuclear,
the demands for an exceptional service and supply is never ending. We
believe manufacturing bolting in exotic materials is an art form and it is
something we have perfected atSSF
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Stainless steel tubes are often used in applications that require rigid
materials for potable water conveyance. Steel tubes can also be used for
structural support in buildings and vehicles. The terms tube and pipe are
generally interchangeable, although technically, tube implies heightened
engineering qualities. Tubes are generally manufactured based on
standardized
sizes.
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Alloy steel is steel that is alloyed with a variety of elements in total amounts
between 1.0% and 50% by weight to improve its mechanical properties. Alloy
steels are broken down into two groups: low-alloy steels and high-alloy
steels. The difference between the two is somewhat arbitrary: Smith and
Hashemi define the difference at 4.0%, while Degarmo, et al., define it at
8.0%.[1][2] Most commonly, the phrase "alloy steel" refers to low-alloy
steels.
3.6.6 steel flanges:
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3.7 Technology:
A cursory examination of the present status of Performance Indices shows
that the technological performance of Indian Steel Plants in terms of specific
consumption of raw material / consumables, specific energy / power
consumption, environmental and pollution norms is significantly lower than
those in the advanced countries. The poor performance standards of the
domestic industry are primarily attributable to poor quality of raw materials /
inputs, prevalence of obsolete technology and lack of R&D to overcome the
technological gaps. Major areas where focus /attention of Industry and
Government are required in the 12thPlan are as follows:
i) Iron ore quality in terms of high alumina content and high alumina to silica
ratio is a serious concern.
ii) There is a need to reduce the coal ash substantially to make our coals
suitable for coke making and iron making operations.
iii) It is suggested that the improvement in raw materials be achieved
through
Selection of appropriate beneficiation process and improvement
operational practices of ore beneficiation / coal washing circuit.
in
iv) Above 20% of the ROM (run of mine) which is known as slime has low
percentage of iron (less than 55%). The size of slimes is lower than 150
micron and further beneficiation is difficult and not economical. There is an
immediate need to find out solutions for the realization of iron value from
slimes. Alternative iron making process such as FASTMELT or ITmk3 may be
useful to realize the iron value efficiently.
v) Use of mine wastes such as Jhama coal in Iron and Steel production will be
helpful to increase the mine life. Coal gasification of non coking coals and
recovery & utilization of CBM are some of the steps to address issues such as
coal / coke shortage and CO2 emissions.
vi) Large size Blast Furnaces with the state of the facilities have done well in
terms of productivity, consumption norms and hot metal quality. With
installation of such furnaces in future, the need for agglomerated burden
(sinter + pellet) is likely to increase. The improvement in burden quality will
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Many everyday products, such as cars, cans and washing machines, are
made of steel. Once these products reach the end of their useful lives, the
steel is recycled. Recycling reduces the consumption of raw materials and
energy and is therefore good for the environment.
To understand the environmental performance of a product, its entire life
cycle needs to be taken into consideration. A life cycle assessment (LCA) of a
steel product looks at resources, energy and emissions, from the steel
production stage to its end-of-life stage, including recycling. Steel can be
recycled over and over again, indefinitely, without any loss of its inherent
properties.
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Is the scope of data and impact categories consistent with the study
goals?
Quality of life cycle inventory (LCI) data
Are the data based on achieved and measured performance? If not, are
the assumptions realistic?
Are the data relevant in terms of time, location and technology?
Energy
Is primary energy (i.e., extracted from the earth) used and are the
different energy sources clearly defined?
Are the rules for allocation stated and has the stepwise procedure been
applied?
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Recycling
Does the study take account of recycling and is the methodology for
credits appropriate?
What impact categories are considered and is the LCI scope consistent
with this?
assessment
methods
technically
valid
and
Have value choices (e.g., weightings) been used and on what basis?
Are weighting methods avoided where comparative assertions will be
available to the public?
Interpretation
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Are the conclusions consistent with the requirements of the goal and
scope of the study?
Is the report transparent and clear regarding the methods and data
used?
Are the LCI results also available where impact assessment is applied?
Critical review
Is the critical review report included in its entirety in the study report?
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Chapter 4
MARKETING RESEARCH
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4.2 Investments
Steel industry and its associated mining and metallurgy sectors have seen a
number of major investments and developments in the recent past.
According to the data released by Department of Industrial Policy and
Promotion (DIPP), the Indian mining and metallurgical industries attracted
foreign direct investments (FDI) to the tune of US$ 1,669.49 million and US$
8,527.34 million, respectively, in the period April 2000February 2015.
Some of the major investments in the Indian steel industry are as follows:
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Key
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Points
Supply
Demand
Barriers
entry
Bargaining
power
suppliers
to
of
Bargaining
power
of
customers
Competition
Financia
l
Year
'14
Page 43 of 91
Prospect
s
There are trends of demand recovery in the property sector and the
demand for infrastructure has also been strong since the Modi
government came to power. However, underlying demand in the EU
is not expected to improve much in 2014. Overall, steel demand is
expected to remain weak due to the continuing economic crisis in
the developed countries and the structural shift in the Chinese
economy. Moreover the world is reeling under the pressure of large
surplus capacity which will remain a serious cause of concern,
especially in times of subdued global demand.
Page 44 of 91
expenses (which has been the case recently) may help a bit.
4.4 Trends:
Growing investment:
Toenhancecapacityby488.66milliontonnes,301MOUshavebeensignedwithstat
es
PotentialsteeladditioncapacitywouldattractaninvestmentofUSD83toUSD166b
illion
Indiaisexpectedtobecomethesecondlargestcrudesteelproducergloballyby201
5-16
Mostofthecompaniesintheindustryareundertakingmodernisationandexpansio
nofplantstobemorecostefficient.E.g.SAILhasundertakenmodernisationandexp
ansionforitssixplants
TheproductioncapacityofSAILisexpectedtoincreasefrom13MTPAto50MATPAin
2025withthetotalinvestmentofUSD24.88Billion
Strategic alliance:
InternationalCoalVenturesPvtLtd,comprisingSAIL,RINL,CIL,NTPCandNMDC,
hasbeensetupforacquisitionofcoalminesoverseas
TheconsortiumofSAILandNationalFertiliserLimited
hasbeennominatedforrevivalofSindriUnitoftheFertiliserCorporationofIndiaLimit
ed
RINL,
VishakhapatnamSteelPlantandthePowerGridCorporationofIndiaLtd
(POWERGRID)
signedanMoUtosetupajointventurecompanytomanufacturetransmissionlineto
wersandtowerpartsincludingR&Dofnewhigh-endproducts.
Entry of international companies:
AttractedbythegrowthpotentialoftheIndiansteelindustry,
severalglobalsteelplayershavebeenplanningtoenterthemarket
NationalMineralDevelopmentCorporation
hassignedanMoUwithRussiasthird-largeststeelmaker,
foragreenfieldsteelplantinKarnataka
(NMDC)
Severstal,
A new steel policy will be aimed to ease the faster growth of the domestic
steel sector by ensuring faster capacity addition, as realized by the
government. The Steel Ministry-constituted panel is scheduled to finalize the
Page 45 of 91
draft within two months and there are expectations that it will be prepared in
another three-four months. The government conceived of taking country's
capacity to 145 MT by 2015-16. The new policy assumes importance as it is
coming up against the backdrop of huge delays in the multi-billion dollar
ventures including those of ArcelorMittal and POSCO which were delayed due
to the hurdles of regulatory and land acquisition.
ArcelorMittal, which has proposed projects worth Rs 1.3 lakh cr. in Jharkhand,
Orissa and Chhattisgarh, is facing land acquisition problems. POSCO, which
has proposed a project in Orissa worth Rs 54,000 cr., is also battling
regulatory hurdles for several years.
4.5 Promotion:
Some domestic Steel Manufacturers and other stake holders have
represented against surge in imports of steel. The same has been
examined by Government and the following steps taken:(i)
(ii)
(iii)
(iv)
(v)
(vi)
Page 46 of 91
Page 47 of 91
Sources:Datamonitor
4.7 Quality:
A new steel policy will be aimed to ease the faster growth of the domestic
steel sector by ensuring faster capacity addition, as realized by the
government. The Steel Ministry-constituted panel is scheduled to finalize the
draft within two months and there are expectations that it will be prepared in
another three-four months. The government conceived of taking country's
capacity to 145 MT by 2015-16. The new policy assumes importance as it is
Page 48 of 91
4.8 Technology:
A cursory examination of the present status of Performance Indices shows
that the technological performance of Indian Steel Plants in terms of specific
consumption of raw material / consumables, specific energy / power
consumption, environmental and pollution norms is significantly lower than
those in the advanced countries. The poor performance standards of the
domestic industry are primarily attributable to poor quality of raw materials /
inputs, prevalence of obsolete technology and lack of R&D to overcome the
technological gaps. Major areas where focus /attention of Industry and
Government are required in the 12thPlan are as follows:
i) Iron ore quality in terms of high alumina content and high alumina to silica
ratio is a serious concern.
ii) There is a need to reduce the coal ash substantially to make our coals
suitable for coke making and iron making operations.
iii) It is suggested that the improvement in raw materials be achieved
through
Selection of appropriate beneficiation process and improvement
operational practices of ore beneficiation / coal washing circuit.
in
iv) Above 20% of the ROM (run of mine) which is known as slime has low
percentage of iron (less than 55%). The size of slimes is lower than 150
micron and further beneficiation is difficult and not economical. There is an
immediate need to find out solutions for the realization of iron value from
slimes. Alternative iron making process such as FASTMELT or ITmk3 may be
useful to realize the iron value efficiently.
v) Use of mine wastes such as Jhama coal in Iron and Steel production will be
helpful to increase the mine life. Coal gasification of non coking coals and
recovery & utilization of CBM are some of the steps to address issues such as
coal / coke shortage and CO2 emissions.
Page 49 of 91
vi) Large size Blast Furnaces with the state of the facilities have done well in
terms of productivity, consumption norms and hot metal quality. With
installation of such furnaces in future, the need for agglomerated burden
(sinter + pellet) is likely to increase. The improvement in burden quality will
facilitate higher injection of coal fines and thereby reduction in metallurgical
coke requirement and overall fuel rate.
vii) The units that have adopted DRI HM EAF and DRI IF routes for iron
making are suffering due to non availability of hard iron ore lump, high cost
of natural Gas, non availability of good quality coal, absence of good scrap
and rising prices of raw material inputs for BF. To alleviate the shortages of
iron ore lump, there is a need to put up pellet plants. Coal gasification is
believed 19to be a good option to replace natural gas for the production of
synthesis gas (reducing gas in shaft kiln process).
viii) Large quantity of slag is produced in BOF / EAF. It is not easy to dispose
of the steel making slag due to the presence of free lime and high
percentage of iron oxide. Technologies have been developed (ORP, MURC) in
Japan to reduce the generation of slag and reduce the Phosphorous level
below 0.010%. Some of the technologies for reuse in the form of brick for
pavement / construction of dykes, flux / iron bearing material in cupola and
construction material after sufficient aging can be adopted to gainfully utilize
the slag. There is also a possibility to recover the iron values through
smelting reduction.
ix) DRI EIF route suffers from lack of refining capacities. The steel melted
by the process has higher percentages of Phosphorus and Nitrogen. Rotary
kiln DRI-EIF route needs to improve its technology substantially to avoid
obsolescence, market acceptability due to poor quality and to reduce its
adverse impact on the environment. There is a dire need for Technology Up
gradation in Secondary Steel Sector in general and the EIF sector in
particular to make them competitive in terms of Productivity, Quality and
Environment friendliness. .
x) Dynamic soft reduction and near net shape casting will result in quality
improvement and energy saving respectively and these emerging
technologies are likely to be adopted in the coming years by the Steel
Industry.
xi) Due to increasing demand for High Strength Steel, current BAF (Batch
Annealing Furnace) technology may get replaced with Continuous Annealing
Technology.
Page 50 of 91
Page 51 of 91
Over the years, with the increasing competition of the marketplace, the
distinction between manufacturing and service industries is getting blurred.
The core, manufactured products today are so entwined with services, that
they have become indistinguishable. Moreover, these services are expected
by the customer as an integral part of the product. Slowly all business is
tending to be serviceoriented, aimed at satisfying customer needs. The
Indian steel industry has been liberalised, after decades of protection and the
competition is fierce. Capacities are being added at a furious pace, newer
technologies are being introduced and cheaper imports are being dumped. In
such a scenario, the answer to gaining competitive advantage lies in
providing superior value to the customer, by providing customer service with
the product at a lower delivery cost. Using customer service to retain and
acquire customers could provide a new strategic advantage for steel makers.
This paper explores the key issues, and possibilities and presents a strategy
for achieving strategic advantage through customer service, in the context of
the Indian steel industry. The concept can be extrapolated for any developing
economy.
4.10 Promotion:
Some domestic Steel Manufacturers and other stake holders have
represented against surge in imports of steel. The same has been
examined by Government and the following steps taken:(i)
(ii)
(iii)
(iv)
Page 52 of 91
(v)
(vi)
Price regulation of iron & steel was abolished on 16.1.1992. Since then
steel prices are determined by the interplay of market forces.
Page 53 of 91
For ensuring quality of steel several items have been brought under a
quality control order issued by the Government.
Iron & steel are freely importable as per the extant policy.
Data on import of total finished steel (alloy + non alloy) is given below
for last five years:
Indian steel industry : Imports (in million tonnes)
Category
2010-
2011-
2012-
2013-
2014-
11
12
13
14
15
9.32
6.66
6.86
7.93
5.45
Exports
Data on export of total finished steel (alloy + non alloy) is given below
for last five years:
Indian steel industry : Exports (in million tonnes)
Page 54 of 91
Category
2010-
2011-
2012-
2013-
2014-
11
12
13
14
15
5.59
3.64
4.59
5.37
5.98
4.11.2 Domestic Price Trends for the past year of Hot Rolled, Cold
Rolled and Galvanized Products
With the firming up of steel prices the world over India should restructure its
steel industry but it is not all that easy. In developed countries the labour
costs are 35% of the total cost of steel production whereas it is only 15% in
India inspite of overmanned steel plants. This cost advantage is wiped out
since the productivity in India is only 90t/person as against 150t/person in
developed countries. It is clear that we have to formulate some strategies so
that Indian steel industry can be made more productive and efficient. Some
of these strategies can be: -
The demand for steel is derived from sectors like automobiles, white goods
and construction/infrastructure. Now, these manufacturers of automobiles
and white goods use finished steel hence the higher the production the
higher will be the revenues of the company. As the chart below shows that
this production is growing steadily but efforts should be made so that this
Page 55 of 91
Page 56 of 91
Establishment 1982
Headquarters - Visakhapatnam, India
Website www.vizagsteel.com
2.Second in the list is Tata Steel. Established in the year 1907, Tata Steel is
worlds 11th largest and Indias second largest steel producer.
Headquartered in Mumbai, they have their manufacturing facilities spread in
26 countries. In India, they have largest state of the art manufacturing unit
at Jamshedpur. They give employment to more than 80,000 people around
the world. They offer range of steel products such as Tata Shaktee, Tata
Wiron etc which are the backbone of leading infrastructure in country.
Page 57 of 91
5. Fifth place is hold by VISA Steel. This steel company is Flagship Company
of giant VISA group. With its corporate office at Kolkata, they have three
manufacturing plants, two branch offices and PAN India network of dealers
and distributors. Their manufacturing plants are located strategically nearer
to raw material producing belt of country. Their two plants are located at
Odissha and one at Chattisgarh. They are planning to setup one more steel
plant of 1.25 million TPA at Madhya-Pradesh.
Type - Private
Head office Kolkata, West Bengal
Establishment 2003
Website www.visasteel.com
Page 58 of 91
7.Essar Steel is placed at seventh position. Essar Steel founded in the year
1998, this ESSAR Group Company is leading name in steel industry in India
and abroad. They have their steel manufacturing operations in four countries
India, Canada, USA and Indonesia. In India, they have manufacturing
factories located at Hazira Bailadilla, Dabuna, , Pune, Paradip and
Visakhapatnam. All of their facilities have various quality certifications such
as ISO: 9001:2000, OHSAS 18001:1999, ISO 9002, etc.
Type - Public company
Head office Mumbai, Maharashtra
Establishment 1998
Website www.essar.com
8. Eighth in the list is The Ferro Alloys Corporation Limited. The Ferro
Alloys Corporation Limited was established in 1955 and has head office in
Nagpur. It is ISO 9001:2000 certified company that works to delivery best in
quality steel. Presently company has more than 18000 employees that work
passionately for the success of company.
Head office Nagpur, Maharashtra
Establishment 1955
Type - Public
Employees - 18,000
Website www.facorgroup.in
9.Mahindra Ugine Steel is a leading steel production company of India.
Founded in the year 1962 at Mumbai, MUSCO is a part of Mahindra Group.
They are known for manufacturing of rings, specialty steel and stampings.
They were the first Indian steel company to get ISO certification. They have
been awarded several recognitions and awards by various national and
international bodies. They have setup residential colonies for their workers in
41.94 hectares with play area and school facilities.
Page 59 of 91
Page 60 of 91
Page 61 of 91
Steel, Semi Free Cutting Steel, Carbon Steel etc. Their steel products are
extensively used by Automobile companies, Construction companies, Sugar
Industry, Railway springs, engineering components, Valve industry and tools
industry.
Sources:indiammarket.in
4.15 . Logistic demand:
Steel sector: Indian scenario
Steel production in Indian in 2015 was 121.534
The averaged per capita consumption of finish steel in rural India is.
Raw material required for one tone steel:
3 tonnes of raw material
3 tonnes of water
3 tonnes of air
4.15.1 .Raw material requirement:
For the target of 300mtpa steel production by 2025, the requirement of iron
ore would be around 450 mtpa, coking coal would be 300 mtpa, non coking
coal of 100mtpa, and other fluxes would be around 50mtpa.
4.15.2. Logistic in steel industries:
Page 62 of 91
[2]
[3]
4]
4]
[4]
[4]
98.1
96.1
93.6
97.2
98.2
77.5
49.3
50.1
47.9
33.4[5] 35.0[5]
47.1
45.8
42.8
44.4
52.9[6]
43.3
43.9
42.7
43.3
41.4
38.4
39.9
35.3
35.1
34.3
[4]
Company
Headquarters
Luxembourg
33.3
31.1
China
37.0
31.3
35.4
28.6
Baosteel Group
China
39.1
35.4
31.1
34.7
31.1
POSCO
South Korea
32.3
31.9
30.1[6]
23.3
22.9
Jiangsu Shagang
China
33.7
30.2
29.8
22.1
20.1
16.0
16.2
Ansteel
China
33.1
39.3
36.4
37.7
36.6[6] 30.3
27.7
20.2
China
31.4
31.2
30.4
29.9
31.1
33.0
34.0
JFE
Japan
10
30.8
31.5
31.4
30.0
25.8[6]
12.2
12.9
Shougang
China
26.4[6
25.8
17.3[6
]
Page 63 of 91
[2]
[3]
4]
4]
11
26.2
25.3
23.0
23.8
23.5[6]
12
23.3
22.8
23.0
24.0
23.2[6]
13
21.4
20.2
20.1
19.9
14
20.6
17.2
17.1
15
19.7
20.4
16
19.0
17
[4]
21.9[6
]
[4]
[4]
Company
Headquarters
24.4
26.5
Tata Steel
India
26.4[7 21.8[8
]
23.8
Shandong
Group
18.3
14.0
20.4
20.0
Nucor Corporation
United States
16.3
12.9
8.4
9.9
10.0
Hyundai Steel
South Korea
21.4
22.0
22.3
15.2
23.2
21.5
United
States
Corporation
19.0
19.8
20.5
21.6
14.2
20.4
18.6
Gerdau
18.9
18.8
17.3
16.7
15.4[6]
18
18.5
19.3
19
16.3
20
14.8[7 15.0[7
Iron
and
Steel
Steel
China
United States
Brazil
14.2
Maanshan
Company
Iron
and
Bohai
Iron
Group (zh)[11]
15.9
17.0
ThyssenKrupp
Germany
and
Steel
Steel
China
China
0]
0]
15.9
15.1
17.9
16.7[6] 11.0
16.3
16.8
15.1
16.5
Benxi Steel
China
21
16.1
15.5
14.9
12.1
11.9
10.9
11.3
9.7
Novolipetsk Steel
Russia
22
15.5
16.1
15.9
16.8
16.3
15.3
17.7
16.2
Evraz
Russia
23
15.4
14.3
12.7
14.0
12.7
8.9
11.0
10.9
China Steel
Taiwan
24
15.4
15.0
14.1
15.9
15.1[6]
11.1
China
25
15.2
14.3
13.8
12.4
8.8[6]
8.4[6] 6.5
7.8
Jianlong Steel
China
26
14.4
14.3
13.6
12.6
11.4
10.6
10.0
10.1
IMIDRO
Iran
27
14.2
15.7
15.1
15.3
14.7[6] 16.7
19.2
17.3
Severstal
Russia
28
13.6
13.2
Fangda Steel[12]
China
29
13.6
13.5
13.5
13.5
13.6
13.5
13.7
13.9
Steel Authority
Limited
30
13.0
11.9
13.0
12.2
11.4
9.6
12.0
13.3
31
12.7
11.8
8.5
N/A
6.4
5.5
3.8
3.0
India
32
11.4
12.7
13.2
11.2
9.8[6]
9.9[6] 7.5
6.2
China
11.8[7 11.3[7
]
of
India
India
Page 64 of 91
[2]
[3]
4]
4]
33
11.2
14.3
12.5
14.4
34
10.9
10.3
7.7
35
10.7
10.0
36
10.7
37
Company
Headquarters
Metinvest
Ukraine
9.4
Anyang Steel
China
10.1
9.9
9.6[6]
9.3
China
10.7
10.2
10.2
10.1[6]
10.5
9.7
7.3
5.8
38
10.3
11.2
10.1
39
10.3
10.2
9.1
World total
1,637
1,607 1,548 1,490 1,413 1,219 1,329 1,351 +
[4]
[4]
9.5[6] 9.2
10.1[6
[4]
8.8
9.8
Baotou Steel
China
N/A
N/A
N/A
N/A
China
10.2
8.6[6]
7.6[6] 6.9
7.4
China
8.6
N/A
N/A
N/A
N/A
Source:IBEF.in
Page 65 of 91
Chapter 5
Financial analysis
Page 66 of 91
Financial Analysis
1. Profit Margin Analysis
A) Gross Profit margin Analysis
Gross Profit margin Analysis=
COGS
Sales
The gross profit margin reflects the efficiency with which management
produces each unit of product. This ratio indicates the average spread
between the cost of goods sold and sales revenue. it indicate the relation
between cost and selling price. high gross profit indicates that the firm is
able to produce at relatively lower cost.
Gross margin ratios of three industries are below
Name of the March201
company
1
March2015
1.SAIL(%)
12.88
9.6
7.2
4.71
6.3
2.tata
steel(%)
3. Jindal (%)
35.16
30.6
24.83
26.1
19.17
30.23
23.96
19.32
17.44
14.33
Page 67 of 91
40
35
30
25
20
1.SAIL(%)
15
2.tata steel(%)
10
3. Jindal (%)
5
0
Interpretation:
-In SAIL gross margin Ratios are continuously decreases from 12.88 to 6.3
which are not good for the Company. It shows the company produces product
in High cost.
- In Same TATA STEEL and JIndal gross margin ratios are Declining from 35.16
to 19.17 and 30.23 to 14.33 which are not good for the company.
B) Net Profit Margin
Net profit ratio is measured by dividing profit after tax by sales. it
establish relation between net profit and sales. this ratio is over all measure
of the firms ability to turn each rupee sales into net profit. the ratio is
indicated the firms capacity to with stand adverse economic conditions. high
margin is good for the company.
formula:
Net profit ratio= profit after tax
Sales
Net profit margin ratios are below of three industries
Name of the March201
company
1
1.SAIL(%)
11.5.
March
2012
7.94
March
2013
4.86
March
2014
5.6
March2015
2.tata
steel(%)
19.73
13.25
15.37
15.47
23.35
4.57
Page 68 of 91
3. Jindal (%)
21.55
15.82
10.64
8.88
-2.32
25
20
15
1.SAIL(%)
10
2.tata steel(%)
3. Jindal (%)
5
0
40603
40969
41334
41699
42064
-5
Page 69 of 91
March2015
1.SAIL(%)
64.79
71.2
65.61
63.74
60.65
2.tata
steel(%)
3. Jindal (%)
64.13
68.95
68.05
70.06
71.77
43.16
43
38.77
36.56
32.39
80
70
60
50
40
30
20
1.SAIL(%)
2.tata steel(%)
3. Jindal (%)
10
0
Interpretation:
debt ratio is about lender have provide debt to company. In Sail debt Ratio is
64.79% and its increases in 2012 by 71.2% which is good for the company.
Its decreases in 2013 by 65.61% and 63.74 %i 2014 which is not be good for
the company but over all said that company have Lander which is good for
the company. Debt Ratio of TATYA STEEL is continuously increases which
shows finance provider are more in the company which is good for the
company.jindal has also Lander of financed but not more than Tata and SAIL.
B) Debt equity ratio
Meaning
Debt/Equity Ratio is a debt ratio used to measure a company's financial
leverage, calculated by dividing a companys total liabilities by its
Page 70 of 91
stockholders' equity. The D/E ratio indicates how much debt a company is
using to finance its assets relative to the amount of value represented in
shareholders equity. A high debt/equity ratio generally means that a
company has been aggressive in financing its growth with debt.
The formula for calculating D/E ratios can be represented in the following
way:
Debt - Equity Ratio = Total Liabilities / Shareholders' Equity
Name of the March201 March 2012 March 2013 March 2014 March2015
company
1
1.SAIL(%)
0.54
0.4
0.52
0.56
0.64
2.tata
steel(%)
3. Jindal (%)
0.55
0.45
0.46
0.42
0.39
1.32
1.33
1.58
1.74.
2.9
3.5
3
2.5
2
1.5
1
1.SAIL(%)
2.tata steel(%)
3. Jindal (%)
0.5
0
Interpretation:
Debt equity ratio is about the lenders contribution in company in respect of
each RS of owners. In SAIL debt equity ratio is 0.54 times in 2011 and its
decreases in 2012 by 0.4% after than its increased by 0.52% and0.56% in
2015 which is good for the company. Debt equity ratio is continuously
decreases in TATA STEEL by 0.55% to 0.39% which shows that owners
investment is more. it is increases in JINDAL from 2011 to 2015 which shows
that company has more debt for running business and its shows growth of
the company.
Page 71 of 91
March2015
1.SAIL(%)
0.79
0.81
0.75
0.72
0.65
2.tata
steel(%)
3. Jindal (%)
0.43
0.45
0.48
0.49
0.46
0.54
0.58
0.52
0.43
0.36
0.9
0.8
0.7
0.6
0.5
0.4
1.SAIL(%)
0.3
2.tata steel(%)
0.2
3. Jindal (%)
0.1
0
Interpretation: this ratios are high in SAIL so its good for the
company. In JINDAL this ratios are continually decreases which are
not
good
for
the
company.
3. Profitability Analysis
A) Operating margin
Page 72 of 91
Meaning
Operating margin is a measurement of what proportion of a company's
revenue is left over after paying for variable costs of production such as
wages, raw materials, etc. It can be calculated by dividing a companys
operating income (also known as "operating profit") during a given period by
its net sales during the same period. Operating margin is a margin ratio used
to measure a company's pricing strategy and operating efficiency. Formula
for calculating operating margisn can be represented in the following way:
March2015
1.SAIL(%)
16.37
13.04
10.34
8.39
10.89
2.tata
steel(%)
3. Jindal (%)
39.06
33.99
29.12
30.72
23.95
37.41
30.46
26.33
25.84
27.67
45
40
35
30
25
20
1.SAIL(%)
15
2.tata steel(%)
10
3. Jindal (%)
5
0
Page 73 of 91
March2015
1.SAIL(%)
13.23
9.24
5.29
6.13
4.81
2.tata
steel(%)
3. Jindal (%)
14.68
12.72
9.17
10.48
9.65
23.75
19.46
12.89
9.88
-2.48
30
25
20
15
10
5
1.SAIL(%)
2.tata steel(%)
3. Jindal (%)
0
-5
Page 74 of 91
Meaning
A method of performance measurement that was started by the DuPont
Corporation in the 1920s. With this method, assets are measured at their
gross book value rather than at net book value in order to produce a higher
return on equity (ROE). It is also known as "DuPont identity".
DuPont analysis tells us that ROE is affected by three things:
-Operating
efficiency,
which
is
measured
by
profit
margin
-Asset use efficiency, which is measured by total asset turnover
- Financial leverage, which is measured by the equity multiplier
ROE = Profit Margin (Profit/Sales) * Total
(Sales/Assets) * Equity Multiplier (Assets/Equity)
Asset
Turnover
March2015
1. SAIL(%)
13.3
8.9
5.6
6.1
4.9
2.tata
steel(%)
3. Jindal (%)
24.2
12.6
-20.7
8.9
-12.5
26.6
21.9
13.7
8.4
-6.1
30
20
10
1. SAIL(%)
0
2.tata steel(%)
3. Jindal (%)
-10
-20
-30
Page 75 of 91
company. ROE of Jindal also decreases in minus in 2015 which shows that
profitability of company is decreases.
5. EPS
Meaning
EPS is calculated by dividing the profit after tax by total no of ordinary shares
outstanding EPS simply shows the profitability of the firm.
Name of the March201
company
1
March2015
1.SAIL(%)
11.87
8.91
5.25
6.33
5.07
2.tata
steel(%)
3. Jindal (%)
71.58
68.95
52.13
66.02
66.3
22.09
22.58
17.04
14.12
-3.4
Page 76 of 91
80
70
60
50
40
1.SAIL(%)
30
2.tata steel(%)
20
3. Jindal (%)
10
0
-10
dividend
No of ordinary shares
March2015
Page 77 of 91
1.SAIL(%)
2.4
2.tata
steel(%)
3. Jindal (%)
12
12
10
1.5
1.6
1.6
1.5
14
12
10
8
6
4
1.SAIL(%)
2.tata steel(%)
3. Jindal (%)
2
0
Interpretation
DPS of SAIL is 2.4 in 2011 after it is Rs 2 which is constant for the other
year. higher DPS is good for the company. TATA STEEL is providing DPS to its
shareholder first 2yers Rs 12 after 2yers declining by RS 8 and RS 10 which
shows the companys profit is decline. Jindal is paid DPS Rs 1.5 in 2011 which
is declining in 2015 by RS 0. Only tata steel is paid more dividend to its
shareholder.
Page 78 of 91
Chapter 6
STRATEGIC ANALYSIS OF
THE STEEL INDUSTRY
opportunities
as
well
as
6.1,1 Strengths
Availability of quality iron ore and processed inputs like sponge iron
Low wage level
Skilled manpower and managerial capabilities
A regionally dispersed secondary steel sector to cater to local demand
Page 79 of 91
6.1.2 Weaknesses
High cost of energy/power
Poor infrastructure linkages for movement of both raw material and
finished products
Inferior quality of indigenously available coking coal
Relatively high cost of capital specially for smaller producers
Low labor productivity as well as rigid labour laws
Dependence on imported technology and equipment including for
maintenance operations
Multiple statutory clearances required for mining and steel making
investments
Issues linked to land acquisition and rehabilitation
6.1.3 Opportunities
Potentially huge domestic demand from steel intensive investments
like infrastructure building, real estate, automobile/ auto components,
communications, ship building, defence, and medical equipment,
consumer durables etc.
A largely untapped rural market
Huge potential for productive foreign collaboration particularly in
specialized steel making products and equipment
6.1.4 Threats/Challenges
Page 80 of 91
Asian countries are in the lead with the production of the steel, china is the
top producer among the Asian countries which are contributing high a supply
of the steel in the international market.419million ton of the steel is
produced only in the china. In past 6 years there are many acquisitions and
mergers are happening in the steel industry. May be this could be the one of
the reasons behind this tremendous growth globally. After the china country,
Japan, India, and South Korea. India is contributing total of the 53million ton
steel in global market. The japan is producing only 9% of the steel which is
contributed to the global steel market. India is also one of the major counties
in the production of the steel. The east, south, and west regions are
important for the steel industry in India. The rapid expansion is expected in
the east region, Orissa because the availability of the superior raw material.
In India because the vast availability of resources and major industry players
India is enjoying the boom in this sector which are responsible of the growth
in the GDP according to the survey which is done by the DEUTSHE BANK
where the analysis is done with detailed survey of 34 economies in nation. It
is observed that India will enjoy the average growth of 5.5% in between the
year 2006 to year 2010. The average is observed for the, where as 5.4% to
the Malaysia. The opening up the economies in the global market is
responsible for the high investment in the industry sector where lots of
acquisitions and mergers are happening in the industry. The PESTEL
ANALYSIS of the industry is divided into five parts which can be discussed as
follows
P- Political analysis
E-economic analysis
S- socio -culture analysis
T-technological analysis
E-environmental analysis
L-legal analysis.
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introduces the National Steel Policy. The main aim for the introduction of this
policy is to fill the gap between the demand and supply of the steel. To
maximize the production is also main activity is designed under this policy. To
increase the production up to million ton is also the main objective of the
policy.
Under this policy the special incentives are designed for the steel sector.
Incentives like the cut in the duty, zero duty on imports, provision of the land
and other infrastructural facilities are the facilities provided for the steel
sector. Under this policy the government is encourage to the use the full
opportunities available in the PUBLIC AND PRIVATE PATNERSHIP (PPP). With
the growing industry the government is increased the sales tax from the
15%to 20% where as 75% FDI (foreign direct investment) is allowed in the
industry this scheme also provides the various concessions in the custom
duties. Though there is a rise in the infrastructure facilities in the country but
considering the steel industry the present condition of the infrastructure is
not sufficient in the nature .because of the lack in infrastructure steel
industry is facing many problems
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6.2.4 TECHNICAL:
The traditional technologies are being used from many years in the industry.
There is no innovation in the use of the technique in the production process.
The Tata steel is developing the same technique is by which the
encouragement is given to the trading of the steel. Tata and sail introduces
the online trading of the steel. Only the electric furnace is being used now
days in the production process but because of the fluctuations in the energy
there is wastage in the raw material. The basic technologies are used in the
production process are basic arc, induction furnace and electric furnace
which are outdated in the nature. Sail the one of the leading steel industry
India is planning to set up a plan with PASCO for using the latest technology
named âFINEXâ.
6.2.5 ENVIRONMENTAL:
Though the steel industry is encouraging the many sectors and the
encouraging the development it is creating the unfavorable environment in
the nature. The all leading industries are following the environmental acts
which are declared by the governments, though it is creating very bad
impact on the environment. Many industries are using the pollution control
equipment and energy saving equipment but that is not sufficient in the
nature. The least importance is given to the environmental aspect. But the
Tata steel is encouraging the ecofriendly system, to reduce the emission the
co2 gas during the production process. Tata is developing the Ultra-Low
Carbon steel making where there will be reduction in the environmental loss.
6.2.6LEGAL:
Government is introducing the various rules and regulations of this particular
industry. The government is about to paying the more attention in the health
policies of the employees which are working with the steel industry. Special
health incentives and rules are introduced in the steel industry
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Free market
Threat of substitutes
Increased use of fibers and polymers in household and automobile.
Aluminum & copper has also created the threat for use of steel
product.
Barriers to entry-high
Huge capital requirement, economies of scale, huge manpower
requirement.Technological sophistication for cost leadership.
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Chapter 7
FUTURISTIC
SCENARIO
OF THE STEEL INDUSTRY
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Chapter 8
CONCLUSIONS
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Indian steel sector has witnessed the rate of 14-25 per cent
production growth for steel in the first two quarter of 2016-2017.
Indian steel industry appears to be heading for good times with
strong domestic demand and the surging demand from china. The
factor driving the demand for steel would be booming
construction activity. Construction industry would be a big
beneficiary for the ongoing national highway development
program (NHDP) and focus on infrastructure sector would
strengthen demand.
The growth in domestic demand for automobile and increasing
trend of outsourcing of auto components by global OEMS (original
equipment manufacturers) from India would provide an impetus
to the steel industry. The white goods segment, another key
consumer of steel is likely to have health demand growth.
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Chapter 9
bibliography
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Websites
www.steel.nic.in
www.indinfoline.com
www.worldsteel.com
www.abnormal.com
www.network.magezine.com
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