Vizag Steel's domestic focus hits exports

The decision by the Visakhapatnam Steel Plant (VSP) to cater to the domestic demand for steel rather than focusing on exports, has seen export figures of the steel plant plummet.

As compared to total steel exports of Rs 768 crore during the last financial year, exports in the first five months of the current fiscal have only been Rs 56 crore.

"We expect exports in the coming months to be in the same range," Y Siva Sagar Rao, director (commercial), VSP, told media persons here on Thursday.

"Our prime obligation is to meet the domestic demand, and VSP is getting good prices in the domestic market. In the current fiscal, most of our products will be sold in the domestic market only," he said.

The central government had revived exports benefits and steel prices are higher in the international market as compared to the domestic market, VSP has decided to focus only on the domestic market this fiscal, he said.

During the period of April-August sales at the steel plant have touched Rs 2,800 crore, registering a 23 per cent growth.

As compared to the last fiscal's corresponding period. This year VSP is targeting a sales turnover of around Rs 7,000 crore, as against Rs 6,200 crore during the last fiscal, he said.

"We are gradually increasing the production of value-added products like high carbon steel products, which is also translating into higher revenues for the company," he disclosed.

While VSP faces no material problems at present, keeping the future needs in mind the company is trying to take equity stakes in captive iron ore and coking coal mines in India and abroad.

"Nothing has been finalised yet," he said. VSP's accumulated losses were reduced to Rs 2,900 crore from Rs 4,900 crore, over the last 24 months and the accumulated losses will be wiped out in the next three years, Rao said.