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New Delhi , Sept. 26

THE fortunes of the Steel Authority of India Ltd (SAIL) are on a northbound track. And with the domestic and international steel markets expected to remain buoyant, there's no looking back for the public sector steel major, according to the SAIL Chairman, Mr V.S. Jain.

Having announced profits of Rs 242 crore in the fourth quarter of 2002-03 and Rs 255 crore in the first quarter of the current fiscal, SAIL is well poised to maintain the pace of improvement in operational performance during the current year at six to seven per cent, the rate it achieved during the last fiscal.

Disclosing this at the 31st annual general meeting of the company held here on Friday, Mr Jain said SAIL "is continuing firmly on the turnaround path. Although our basic policy is to remain a leading domestic player, we will maintain our thrust on exports to balance our sustained production growth." He informed the company's shareholders that there was sufficient ground for optimism on demand for steel remaining strong, both in the international and domestic markets.

Calling 2002-03 as the "turning point" for SAIL, Mr Jain said that he felt heartened that the improvements were continuing in the current year as well. After surpassing the 10-million tonne mark in saleable steel production for the first time last fiscal — a growth of seven per cent over the previous year — the steel giant has recorded the highest-ever April-August production of saleable steel this year at 4.3 million tonnes, an improvement of eight per cent over the same period last year.

"This reflects an average capacity utilisation of 102 per cent, indicating a healthy resurgence," Mr Jain said.

India's largest steelmaker has also shown considerable growth in sales. Mr Jain informed the company's shareholders that in the first five months of the current fiscal, a growth of more than 10 per cent has been recorded with sales of 4.1 million tonnes being notched up this year as compared to the April-August period of 2002. This includes an improvement of 126 per cent in exports.

"Our attempt will be to explore new markets to diversify our export base," said Mr Jain, adding that though "the sustained strong demand from China has helped to revive the international steel market, substantial dependence on one single market carries its own risks, given the cyclical nature of the steel industry."

Mr Jain said that efforts to reduce debt and interest costs were also continuing apace. The company has already achieved an interest saving of Rs 105 crore in the first quarter of the current fiscal after effecting an overall interest reduction of Rs 228 crore in 2002-03 through effective cash management, he said.

To a shareholder's query on the company's plans for continued technological upgradation of the steel plants, Mr S.C.K. Patne, Director (Technical), said: "We expect to spend around Rs 600-800 crore each year on new facilities. Based on our resource position, the expenditure programme could be augmented."

He pointed out that several major schemes, involving investment of over Rs 700 crore, were already underway. These include facilities for long rail production at Bhilai, upgradation of the pipe plant and rebuilding of the coke oven battery (No. 1) at Rourkela and the installation of bloom caster at Durgapur. Some other important projects, including upgradation of Bokaro steel plant's cold rolling mill, were under active consideration, he said.

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