Jindal Steel and Power Ltd (JSPL) has said that the impact of the recently-announced export duty by the Indian government will not be significant on its operations. JSPL’s product mix includes welded structures and head hardened rails which do not fall under the purview of the export duty announcement.
The Company exported about 2.5 million tonnes (mnt) of steel in FY’22 and is optimistic about exports in the current fiscal as well.
“We will not export the products which adversely affect the availability of steel in the domestic market. For instance, wire rods and rebars won’t be exported as its exports will impact government projects”, said V.R. Sharma, MD, JSPL.
In addition, the steel major has achieved its guidance for FY’22 and announced its production and sales guidance for FY’23. The company plans to produce 8.5-8.6 mnt of crude steel and targeting sales of 8.2 mnt in FY’23.
JSPL plans to expand crude steel capacity at its Angul works (phase II) to 12 mnt by Mar’25. It also aims to achieve total crude steelmaking capacity of 15 mnt by 2025-2026.
The steel major is planning to set up the nation’s first rail wheelset manufacturing plant at its Raigarh facility with an initial capacity of 25,000 wheelsets per annum. “The project will help Indian railways to gear up the modernization of rail infrastructure by making world class rail wheels,” said Sharma.
Other highlights
- Crude steel production up 7% y-o-y: JSPL’s crude steel production rose 7% to 8.01 mnt in FY’22 compared with 7.51 mnt in FY’21. It achieved the best ever production volume in Q4FY’22 at 2.11 mnt, up 8% against 1.96 mnt in the previous quarter.
- Sales up 5% y-o-y: JSPL reported sales of 7.64 mnt in FY’22, up 5% from 7.28 mnt in the previous fiscal. Sales rose 14% q-o-q to 2.08 mnt in Q4 as against 1.82 mnt in Q3. The share of exports in total sales rose to 29% in Q4 from 23% in the previous quarter.
- EBITDA up 15% y-o-y: The company’s EBITDA registered a rise of 15% to INR 15,037 crore in FY’22 as against INR 13,055 crore in the previous fiscal against the backdrop of the steep surge in coking coal prices.
- Downstream business: The company will focus on its rail downstream business in future and is looking for derived technology for forging high-grade rails for high-speed trains to be introduced in the country. Also, it plans to set up a plant in Raigarh for forging and manufacturing wheels.
- Reducing carbon dioxide emissions: The steel major plans to set up a CO2 consumption hub in Angul or Paradip as it aims to become the largest steelmaking company in world in terms of capturing carbon dioxide. It aims to capture 5,000 tonnes of CO2 per day.
- Coking coal prices: Coking coal costs in Q1FY’23 is expected to edge down by $25/t from the previous quarter.
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