Subhrakant Panda, MD, Indian Metals and Ferro Alloys, in a recent interview with CNBC-TV18 predicted that ferro chrome prices are likely to cool off soon, and also revealed IMFA’s EBITDA margin.
He mentioned that ferro chrome prices for Apr-June quarter has been benchmarked at 154 cents/pound which is 6.7% lower than the current quarter benchmark price of 165 cents/pound. He further added that slightly lower prices could actually be beneficial in the long-term, as after such an upswing in prices from Jan’17, can help bring a bit of sustainability.
Moreover, he also mentioned that the key fundamental drivers of ferro chrome will remain unchanged which includes high demand from China aided by high chrome ore price as input cost.
On being questioned about their production volume in fourth quarter, he revealed that 55000-57000 tonnes is the target. He also disclosed that FY18 may witness a volume boost projecting around 2,50,000 tonnes against 2,30,000 tonnes in FY17.
He also said that the actual trade prices are lower than benchmark prices but the EBITDA margins are at 30-35% which sum up to roughly at INR 35,000/tonne.
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