Net sales of major producers in India may decrease 3-8%

Net sales of major producers in India may decrease 3-8%

According to market sources, the recent round of price cuts by major steel producers in India, including SAIL, Essar, TISCO, Vizag and Ispat could cause net sales of these steelmakers to drop by 3-8%. An Indian daily newspaper reported that the analysis was completed on the basis of domestic sales volume for financial year 2004, which was then multiplied by the price cut amounts, thereby providing analysts with the impact of the price cuts in monetary terms. In the past week, India's five major steel producers have reduced prices by Rupees 500-2'000/ton, mainly directed at their customers in the domestic market. However, retail sales through dealers, which account for 10-30% of domestic sales across companies, have not been taken into account in this calculation. However, analysts are careful to warn that the impact of the price cuts should not be considered in isolation, especially in light of the recent changes in the customs duty structure.