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The Indian steel industry has faced a difficult fiscal but is poised to turn around. BE’s Saptarshi Deb spoke to Saket Agarwal, Director, Micky Metals, on the outlook of the the steel industry in the coming fiscal.

Q) The current fiscal has been difficult for the construction industry. How has been your experience? How much of your annual capacity of production will be released for the current fiscal?

A) The current fiscal has had its set of challenges. We had to face some labour-related issues but overall, we did not face any significant challenges since most of our labour force is local. Over the last nine months, we have been able to match capacity utilisation to the tune of 70% of our actual capacity - which is a good improvement considering this to be a special pandemic year.

Q) How would you look forward to the coming fiscal for the Indian steel industry?

A) The graph of the steel sector and the overall industrial scenario is only pegged to grow higher. The central government has laid special emphasis on this sector since it is the backbone of development for any growing economy. The government has pledged to contribute towards infrastructure spending and that will give a huge stimulus to the domestic steel and other ancillary industries.  

Q) Would you be expecting any special provisions in the upcoming Budget that would strengthen the Indian steel industry?

A) Yes. We are looking at reduction of specific taxes to increase production. Increase in production is directly related to an increase in demand. The government should announce big ticket investments and most importantly, give access to secondary steel producers to be able to supply to them. The government should completely abolish any distinction between steel industries based on their size and the ISI quality should be the only benchmark in deciding if any industry is eligible to supply to central projects. This domain has primarily been monopolised by the large steel players leaving little room to secondarily steel producers. Secondly, we will look forward to reduction of custom duty. The domestic steel industry is seeking reduction in basic customs duty on key raw materials like anthracite coal, metallurgical coke, coking coal and graphite electrode in the upcoming Budget. The non-availability of these items in good quality and quantity hinders the growth of the steel industry. The basic customs import duty on anthracite coal is 2.5%. The availability of good quality anthracite coal is declining in the country and the steel industry may have to become totally dependent on import of these items on a regular basis. As per the CII, the import duty on these items should be brought down to nil. The government has also taken a slew of measures to streamline logistics and operations across industries with measures such as e-way bills and compulsory e-invoices for all companies with a turnover greater than 100 crores. This is a positive step towards ensuring ease of doing business. The Union Budget 2020 should give a push to big-ticket infrastructure projects, thus, increase the demand for steel. The government should also put strong emphasis on collating labour laws and create systems to augur industrial growth and scrap the archaic labour laws. 

Q) Please tell us about your experience with the earthquake resistant ‘Micky Power + 600 SD’ bars? How has been the market response?

A) Micky Power + 600 SD has given us a very positive response from the market. The bars are highly ductile making it extremely useful for earthquake prone areas. Micky Power + TMT 600 SD with its special rib pattern, unlike any in the industry, holds the cement at a much higher surface area, thereby giving a firm grip on the construction quality and ensures longevity.  

Q) Please take us through your product portfolio. Are you planning to make any addition to your product portfolio?

A) At the moment, we have three TMT brands. We are the only company in India that has three simultaneous brands with a significant presence in the market. They are Elephant TMT, LUX TMT and Micky Power + TMT bars. They are all strategically positioned in the market as per our market research and based on the response from our on-ground team and our highly experienced marketing executives. We are planning to introduce further technological changes in line with futuristic market requirements where the consumption of TMT may be brought down by 25% - thereby benefiting the end consumer.

Q) You have a strong presence in eastern India. How would you plan to expand your national presence?

A) We are pegged strongly in the eastern circuit since our inception. The eastern market has tremendous scope and with the government emphasising more on infrastructure projects, the market still has a lot of potential. The eastern region will definitely hold an important place in our presence but we are also slowly and steadily foraying into other states like Rajasthan, Jammu & Kashmir, and other states.