India's SAIL Invests More Than $1 Billion in Steel Product Mix Improvements

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--Steel Authority of India Limited (BSE:500113) (SAIL) (Kolkata, India) plans to invest more than $1.1 billion in product-value addition and product-mix improvement, as part of its $11.4 billion modernization and expansion plan.

Some of the products that are to be part of the initiative are liquefied petroleum gas (LPG) cylinders that are lighter in weight; earthquake-resistant plates; deep-drawing steel for the auto industry; and special plates for naval applications.

SAIL has developed a new type of steel to be used in LPG cylinders, which will bring the units' weight down by 2.5 kilograms. A conventional domestic cylinder is made from 2.9-millimeter-thick steel sheets. From one ton of steel, 62 cylinders can be manufactured.

"The new steel, with 2.4-millimeter thickness developed and produced at SAIL for LPG cylinders, has a higher strength-to-weight ratio," said SAIL Chairman C.S. Verma. "Now 70 cylinders can be made from a ton of steel."

SAIL already has supplied more than 50,000 tons of the new steel to a firm for the fabrication of export-quality cylinders.

The steelmaker also plans to offer galvanized steel and cut-to-size and ready-to-use materials, which are mainly used in the auto sector.

Branded products in SAIL's retail channel will double from 500,000 tons per year to 1 million tons, after the modernization and expansion of the IISCO steel plant and the launch of a new cold-rolling mill at the Bokaro steel plant. The state-of-the-art mill will increase the supply of cold-rolled coils to auto majors and component manufacturers.

"After the expansion and modernization, the proportion of branded products in the company's portfolio will go up to around 25% from the current 15%," Verma said.

For related information, see June 5, 2013, article - SAIL Hits Record Steel Production, Energy Efficiency in May.

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