Essar reports good turnaround due to bullish steel market

Essar reports good turnaround due to bullish steel market

Indian steelmaker Essar Steel reported a Rupees 34.44 billion ($753.4 million) turnover for 2002-2003 fiscal which ended in September 2003, representing a 56% increase over last fiscal. It is expressed that the higher steel prices, growing domestic consumption with an annual rate of 5-7%, as well as surging steel demand from China helped Essar Steel perfectly in 2002-2003 fiscal. The only possible difficulty for the Indian company to keep its positive track in the current fiscal is seen as the natural gas shortage, resulting in higher input costs. However this concern is pretty unnecessary due to two liquid natural gas (LNG) terminals at Dahej and Hazira, waiting to be put in commission within 2004. Apart from above cited factors in gaining positive financial results, company's efforts are reportedly to make an effective financial plan for the debts, to go capacity expansion in hot rolled coil plant and to produce new high value steel products. These initiatives have lowered long term debt of the company by around 22% to Rupees 41 billion ($898 million) and is expected to decrease further by around 24.4% by April 2004. Furthermore, company produced 1.75 million tons of hot rolled coil in last fiscal and aims a production of 2.1 million tons in the current fiscal.