SAIL (Steel Authority of India Limited) has announced fiscal year end results for FY19. The company achieved robust growth in terms of both physical and financial output in FY19 against previous fiscal. SteelMint attended the earnings conference call conducted today and below are the highlights for the same:
1. Crude steel output up by 8% in FY19 – Company’s crude steel output reported surge of 8% in FY19 to 16.3 MnT as compared to 15 MnT in previous fiscal.
2. Saleable steel production increase by 8% in FY19 – Saleable steel output reported increase of 8% to 15.1 MnT in FY19 as compared to 14.1 MnT in previous fiscal.
3. Company’s EBITDA doubled in FY19- SAIL reported significant growth in its EBITDA in FY19 to INR 10,267 Cr as compared to INR 5,102 Cr in FY18.
4.SAIL aims 17.5 MnT saleable steel output in FY20- Company’s projection for saleable steel production stands at 17.5 MnT. Regarding saleable steel sales, projection stands at around 17 MnT.
5.Net Sales realization (NSR) under pressure amid dull prices since past 2 months – SAIL reported Net Sales Realization of INR 39,900/MT for longs and INR 40,560/MT for flat steel in Q4 FY19. However currently the average NSR is at INR 39,600/MT. Market conditions has remained dull in Apr-May resulting NSR under pressure.
6. MIP ruled out, Safeguard imposition under govt consideration – Imposition of Minimum Import Price (MIP) has been ruled out. However we have suggested govt for imposing 25% safeguard duty on steel imports to protect the interests of domestic industry. The company expect some announcements regarding Safeguard duty to come out in June’19.
7. Steel exports in FY19 – Exports reported surge to by 10% in CPLY to 7,63,000 MT and achieved highest ever export sales in last 13 years in FY19.
8. Improvement in share of Value added steel – Company’s value added steel production improved to 52% stood at 6.897 MnT in FY19. Meanwhile on quarterly basis value added production stood at 2.122 MnT in Q4FY19.
9. Increase in production volumes by adding two new blast furnace- Enhancement of production volume by addition of 2 new 4060 m3 Blast Furnaces and one Blast Furnace of 4160 m3
10. To increase production of rails to match demand – Increased production of rails and wheels to meet the increasing requirements of Indian Railways. Production of rails stood at 0.985 MnT in FY19 and aims production of 1.3 MnT in FY20.
11. Steel inventories increased in FY19 – Inventory level of finished steel goods increased to 3,64,000 MT in FY19 and inventory levels of Semis decreased to 1,46,000 MT in FY19. However due to sluggish demand in Nov-Jan accumulated inventories are carried forward in upcoming fiscal.
12.SAIL plans to set up new Pellet plants – New projects are being taken up. Two new Pellet Plants shall use the existing reserve of fines incl. dumps & slimes at captive mines. The combined capacity of these pellet plants is 7 MnT pa. The break up for the same is as follows: 4 MTPA capacity at Gua, 1 MnTPA at Dalli and 2 MnTPA at RSP
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