Essar Steel looks to double production

The company has a great production capacity of steel at Hazira in Gujarat, where they produce 10 million tons per annum. So, the company is expecting to record an 80-85% of total capacity utilization rate in April 2016, that is the coming financial year The Dollar Business Bureau

Essar steel has a great production capacity of steel at Hazira in Gujarat, where they produce 10 million tons per annum

Essar steel is now operating with 70% more capacity utilization, where they have doubled the production since November. The company is also expecting a good turnaround in the March quarter. The company has a great production capacity of steel at Hazira in Gujarat, where they produce 10 million tons per annum. So, the company is expecting to record an 80-85% of total capacity utilization rate in April 2016, that is the coming financial year. The spokesman of the company also said that the company’s debt per ton is only Rs.30,000 which is lower than the industry average of Rs.35,000 per ton. The company also pointed out that it has already paid the lenders over Rs 20,000 crores in the last three and a half years, by suffusing Rs.9000 crore through way of interest and principal repayments. The balance payment has come through the EBITDA margin from 5% to 18% in November 2015. A release by the MD Dilip Oommen to the media said, “Our efforts over the last few months in strengthening our operations, supported by stable markets and encouraging response from our customers, has given us the confidence to aim at full production in the next fiscal. It is heartening that we are able to achieve this while maintaining higher operating margins. We believe it is comforting to all our stakeholders.” Essar steel expects to register a growth rate of 50 -55% whereas the rate was only 30-35% in 2014-15. The gas availability at a much economical price has helped operationalization of the gas based DRI units and have additionally helped the usage of captive gas from blast furnace and COREX. Corex module was commissioned by Essar, as part of its expansion programme for increasing steel production capacity from 4.6 MTPA to 10 MTPA.

March 17, 2016 | 05:20pm IST

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The Dollar Business Bureau - Mar 17, 2016 11:56 IST

Essar Steel looks to double production

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