Vizag Steel Plant eyes Rs 7,500cr in sales turnover

The Visakhapatnam Steel Plant (VSP) is coming up with a new marketing strategy to ensure better penetration of its products and also to ensure that products reach end users directly.

VSP, which sells an average of 30 lakh tonnes of steel every year, expects Rs 7,500 crore in sales turnover this fiscal.

According to the proposed marketing strategy, the company will widen its market network which will see its products being available across the state.

"At present, we have 24 branch offices and 160 long term contractors (LTC) across the country. About 50 LTC dealers sell only VSP products but now we want to broaden this network across south India, mainly in Andhra Pradesh. To this end we have set up a committee which will survey the market and recommend the places where we need to set up an additional dealer network," Y Siva Sagar Rao, director (commercial), VSP, told Business Standard.

"The quality of VSP steel is better than that of competitors and if customers engaged good designers, the consumption of our steel products in construction could come down between 10 and 15 per cent," Rao claimed, adding, "It is because of this reason that customers prefer our steel despite them being priced higher between Rs 1,000 and Rs 2,000 per tonne, when compared to products from other steel companies," he stated.

At present, VSP's major customers like reroller mill operators and wire products manufacturer have been depending on dealers for VSP products.

They are paying a premium to get these materials from the dealers which has led to VSP mulling the supply of material directly to its major users.