Neelachal Ispat Nigam Ltd (NINL)- India’s largest and state owned steel grade pig iron manufacturer & exporter has sharply reduced its pig iron prices for steel grade by INR 1,300/MT (USD 18), w.e.f. 23rd Oct’18. Prior to this, the company had raised prices twice in Sep’18 total of INR 2,100/MT (USD 29).
The latest offers for Steel grade by NINL floated at INR 28,900/MT (USD 393) as against offers during Sept’18 at INR 30,200/MT (USD 420); prices are basic, ex-Cuttack, East India. Bulk purchase discounts remained unaltered in the range of INR 100-400/MT.
As per industry players, the company has cut prices due to significant fall in local steel & pig iron prices through the private producers in last one month, this has forced producer to cut prices in line to attract smelters.
The current steel grade pig iron prices through the private producers based in Jharkhand reported at around INR 29,000-29,500/MT (USD 394-401) & in Durgapur at INR 29,500-30,000/MT (USD 401-408), ex-plant & excluding GST.
NINL’s Q2 Output Spikes by 81%
NINL has recorded 81% rise in its production in the July-Sept’18 quarter (Q2) of this fiscal. During this period NINL rolled out 2.23 lakh tonnes of hot metal and 1.98 lakh tonnes of pig iron.
The steel company’s September figures was also the best since it commenced commercial operations. NINL produced 75,535 tonnes of hot metal and 63,550 tonnes of pig iron in Sept’18.
Profit Margins Increased on Ramp-up Productions
Post NINL’s blast furnace capital repair work, the company is on fast pace on the recovery path. The turnaround signs for the MMTC promoted steel company were manifested in its April-August performance when NINL raked in INR 4000 earnings per tonne of pig iron sales.
In the comparable period of 2017-18, NINL was EBITDA (earnings before interest, taxes, depreciation, and amortization) negative. With operating income profit during the first five months of the current fiscal, NINL is eyeing to reach a stage of net profit.
SS Mohanty, vice chairman, and managing director at NINL attributed the company’s turnover during the five months period also jumped by INR 298 crores than the same period of the last FY.
The rise in turnover and positive EBITDA is attributed to the considerable increase in production after the resumption of Blast Furnace operation in May 2018 after the capital repair.
The production capacity of the Blast Furnace has been doubled. Presently, average production of the hot metal is about 3000 tonne per day. Steel Melting Shop (SMS) will be fully operational by the end of October 2018 which will lead to the production of billets for better value addition and increased productivity & profitability.
With the operation of its captive iron ore mines by end of this fiscal, NINL will turn around and will make the net profit.
The company has signed a MoU (memorandum of understanding) with National Aluminium Company (Nalco) to set up coal tar distillation plant on the joint venture (JV) mode for coal tar generation in NINL s Coke Oven. NINL will start manufacturing of TMT bars under NINL brand in this fiscal and produce wire rods through conversion of billets.
Leave a Reply