mjunction is the largest e-commerce platform in India and offers trading platforms for steel, coal, iron ore, among other commodities, and automobiles. "In the next couple of months, we will start a pilot run of an index each on coal and steel prices, which will then be disseminated on a daily basis," Oberoi said.
For calculation of the steel index, prices of intermediate products, like billets and ingots, will be considered along with hot rolled coils.
"However, we are still to figure out the base prices for the coal index. We are still working on it," he said. Oberoi said the company will be able to provide details on the coal index and the base varieties used for its calculation in a month.
High commodity prices
Oberoi said there has been no impact on mjunction's trade volumes despite government pressuring steel and coal producers to cut prices due to surging inflation.
"There has been no impact on our volumes because of the prevailing price situation. Rising prices of coal and steel are rightly a cause of concern but the answer to this problem lies in increasing supplies," Oberoi said.
He cited the example of coal in which government has allowed e-commerce platforms like mjunction to trade 15 per cent of the country's total coal output.
"This is up from 10 per cent earlier, which will increase the total quantity of coal traded on e-commerce platforms by 20 million tonnes from 38 million tonnes a year at present." E-auction of coal was restarted in November.
Expansion of trading
The company is expecting an increase in turnover of all commodities traded on its platforms to over Rs 50,000 crore in five years from around Rs 10,400 crore now.
Currently, the company's turnover is growing at a compounded annual growth rate of nearly 70 per cent.
"Recently, several other steel producers, such as Jindal Steel and Lloyd Steel, have joined our platforms to sell their products. Several other companies are in talks to join us, including some mining companies," he said.
At present, Tata Steel and SAIL sell steel products on the mjunction platform, while National Mining Development Corp sells iron ore.
The company recently tied up with Corus Steel, Tata's European subsidiary, to create a procurement platform to help the company interact with its suppliers.
"We will offer similar services to other companies in the region depending on how successful the Corus project is," Oberoi said.
The company will invest Rs 20-25 crore in financial year 2009 to upgrade technology.
