Vizag Steel Plant's H1 sales up 31%

Visakhapatnam Steel Plant (VSP) has registered a 31.5 per cent growth in sales during the first half of the current fiscal, as compared to the last fiscal's corresponding period.

The steel plant also posted a 45.8 per cent growth in domestic sales in the same period. As VSP has shifted its total focus to domestic sales, it witnessed a drastic fall of around 70 per cent in steel exports during this period.

In the first six months of the current fiscal, VSP sales increased to Rs 3,358 crore as against Rs 2,553 crore in the corresponding period of the last fiscal, thus posting a growth of 31.5 per cent.

At the same time, the domestic sales increased to Rs 2,363 crore in the first half of the current fiscal as against Rs 2,238 crore in the corresponding period of the last fiscal, thereby recording a growth of around 45.8 per cent.

Despite a 10.5 per cent drop in hot metal production, VSP achieved its highest turnover. In the first half of the current fiscal, the steel plant produced 18.2 lakh tonnes of hot metal and 15.42 lakh tonnes of saleable steel as against 20.4 lakh tonnes of hot metal and 15.26 lakh tonnes of saleable in the corresponding period of the last fiscal.

"In the current fiscal, we mainly focused on the south Indian market. With this, our transportation costs has reduced considerably. The company has also changed its product mix. Due to this, the finished product qualities increased and the semis products' production have reduced. We also increased the production of value-added products. In the current year, we got better realisation for our products as compared to the last fiscal. Due to these reasons, we achieved highest growth in sales turnover," Y Siva Sagar Rao, director (commercial) of VSP, told Business Standard.

"VSP's product prices increased by about Rs1,000 to Rs 1,500 per tonne of steel as compared to the last fiscal, and the company achieved a 23 per cent growth in production of value-added products in the current fiscal. All these reasons attributed to the increase of our sales turnover in the domestic market. However, VSP witnessed a drastic fall in steel exports. In the current year, the steel plant exported only Rs 95 crore worth of steel products as against Rs 315 crore during the corresponding period of last fiscal, thus posting a short fall of about 70 per cent. "There is a lot of demand for our products in domestic market, and the government is also insisting us to first meet the domestic demand. Due to this, our exports have fallen," he said.