MUMBAI, India Steel Authority of India Ltd. (Sail) is targeting 50 billion rupees ($786 million) in savings through cost optimization initiatives over the next three years.
Indian steel companies are facing the dual challenge of high production costs and lower sales, Sail said Sept. 12, noting that the cost of production is being driven up by volatility in the price of coal, higher railway freight costs, power tariffs, royalties on minerals and the depreciation of the rupee.
At the same time, prices are flat due to prevailing market conditions, leading to strong pressure on margins.
A company spokesman didnt respond to AMM sister publication Steel Firsts queries about the details of the plan.
Sail is Indias largest government-owned steel company and its second-largest steel company overall, with an installed annual steel production capacity of 3.5 million tonnes. The New Delhi-based company plans to increase this to 50 million tonnes by 2025.
A version of this article was first published in AMM sister publication Steel First.