Production went up by 36%, says Naushad Akhter Ansari, CEO of Jindal Steel and Power. In his interview Ansari also spoke about various matters including price fall caused by monsoon season.
Q: Could you tell us the EBITDA per tonne, which you registered in the quarter and what is the future for this looking lime?
A: If you look at our performance in this quarter it has been quite well both in terms of production and revenues. Production went up by 36 percent and revenues went up by almost 100 percent on standalone basis. EBITDA has also gone up 19 percent. On EBITDA/tonne basis it is close to about Rs 13840, which is Rs 1000 more than the last quarter and compared to last year it is almost 50 percent higher. So these numbers are good and we are happy to report that.
Going forward, since India is having monsoon and in this season as expected the Long prices always go down and that is what is happening, we also see that in later part of July, and now August the Long prices especially in terms of TMT etc have gone down quite a bit. But we also see some positives. We see for example, the secondary has already started increasing their prices.
Therefore I would imagine going forward in the short period of time again the prices should improve. In the next quarter, they should come back to normal that is what we expect.
Q: What is the total price correction that we have seen in steel? Could you tell us what is the situation now till date from July as compared to April to June?
A: We are both in Long and Flat, and as far as flat is concerned that reduction is very minimal only about 1-1.5 percent. It is more because of sentiment since Long prices are coming down, there is bit of impact also on prices of Flat.
But primarily, Flat is down almost by about Rs 1500 which will correspond to 3-3.5-4 percent.
Q: What are sales volume target for FY19 – is 8.5 - 9 million tonnes (MT) on the cards?
A: Yes, if you look at Oman it should be doing 2 MT this year. We have got some additional gas in Oman which they should be utilizing it well. We have also set up additional casters, so that should also help in increasing that. So, Oman should be doing close to 2 MT.
As far as India is concerned we do expect it to be somewhere around 6-5.5 MT. Therefore we are close to the numbers we have talked about, so whether it will be exactly 9 or somewhere around 8.5 MT but it is going to be in that region.
Q: For Oman the EBITDA has looked good for the past two quarters what is your sense in terms of what we could expect in FY19?
A: We would love to have that number. In Oman also there are some seasonal impact which is there and we do find that the prices have dropped a bit in Oman but I know for sure that it is going to be corrected very soon.In the last month or so the stocks had built up a little bit, some payment issue from the government etc but it is all getting resolved, so that led to some decrease in the prices but as far as target somewhere close to USD 300 million EBITDA remains.