Stock Watch

Under the supervision of new Chairman, SAIL is all set for an expansion in order to produce more specialty steel for nuclear power plants, defense and the space industries.

Chairman CS Verma, 51, said that the Rs. 40,550-crore Maharatna public sector unit is also planning some global purchases of raw material resources.

He was addressing the reporters on Friday after he became SAIL Chief.
He added that the first and the foremost thing is that SAIL should be capable of making all types of steel and that the power sector, defense and space sector requires it the most.

Steel Authority of India’s new Chairman CS Verma said, that they will increase their production capacity of value-added steel necessary for the power circuit. It will expand its global presence through unions and purchases.

SAIL was recently appointed Maharatna Company by the Government of India. It has posted impressive results. Its net profit jumped over 40% to Rs. 2,085 crore in January-March 2010 compared to Rs. 1,485.20 crore in the same period last year. The Company’s total income increased to Rs. 12,672.6 crore in the fourth quarter of 2009-10 compared to Rs 12,519.3 crore in the same quarter last year.

According to the SAIL Chairman, joint ventures between the public and the private sectors would provide a major boost to the mining sector.

SAIL Chairman S K Roongta told the reporters that, "There are 4-5 big players in the domestic steel industry. I think, now, if they can come together to create a big war chest we can go for big ticket acquisition of resources which are not available in the country. In the long-run, it is in the interest of the industry”.

On Thursday, the Cabinet Committee on Economic Affairs (CCEA) has given consent to a proposal of the Steel Authority of India Ltd. (SAIL) to raise extra capital through sale of the Government's stake in the company and issue of fresh equity in two tranches.

Home Minister, P. Chidambaram, briefed reporters regarding the CCEA's decision, “Both the tranches will include a fresh issue of 5% pre-issue paid up equity of the company and offer of sale of 5% of Government equity in SAIL”.

An agreement was signed Monday by Steel Authority of India Limited (SAIL) with Shipping Corporation of India Ltd. (SCI) with the aim of setting up a 50:50 joint venture company. The new company, under the agreement, will most importantly take care of SAIL's shipping needs by owning and operating ships.

SAIL Director (Finance) Soiles Bhattacharya and SCI Director (Technical & Offshore Services) U. C. Grover signed the agreement and SAIL Chairman S. K. Roongta and SCI Chairman S. Hajara were also present while the agreement was being signed.

State-run steel company, Steel Authority of India (SAIL) and South Korean major, Posco are expected to sign a Memorandum of Understanding (MoU) very soon.

As per the MoU, the two companies would be starting a 5 MT of integrated steel plant in Jharkahnd. The total cost involved in this project is expected to be Rs. 25,000 crore.

Posco is going ahead with the plan even though its Rs. 54,000 crore worth of project is in shackles in the state of Orissa. The total capacity of the plant is said to be 12 MT.

As has been confirmed by the state-owned and run Steel Authority of India Ltd., or SAIL, the steelmaker is currently joined in talks with South Korean POSCO, in order to boost the co-operation between giant Asian steel manufacturers.

There were, however, no confirmations shared on whether there would be talks of setting up a joint plant in the sub-continent.

Steel Authority of India Ltd has recorded a quarterly net profit for first time in five quarters and the PSU aims at improving output and sales in the March quarter. The demand from automobile and construction sectors is rising and this could improve sales for the company.

Tata Steel and Steel Authority of India, the Indian steel giants, have jacked up the prices of steel, reflecting a higher demand for the commodity.

SAIL withdrew discounts to retailers which resulted in the rise of prices of flat and long products by Rs 700-1,500 a tonne.

Rival Tata Steel raised the prices of long products by Rs 2,000 a tonne. However, Tata Steel left the prices of flat products untouched.