India's Visa Steel, part of the Visa group, is expecting an increase of over 50% in its sales turnover in the last quarter of this fiscal from its ferrochrome, pig iron and LAM coke, and sponge iron production.
By the end of this fiscal, the company plans to finish the second phase of expansion at its sponge iron (DRI) facility in Orissa and the proposed 50 mw power plant. The capacity at the DRI plant currently stands at 1.5 lakh tonne and another 1.5 lakh tonne will be added in the second phase.
Vishal Agarwal, managing director, Visa Steel, told DNA Money, "Sales have revived and are expected to increase this quarter but it's definitely a tough quarter. Prices of steel have stabilised to some extent and a lot of de-stocking has taken place at the customer end." The depreciation of rupee against the dollar and decline in steel prices have attributed to a flat average realisation for the last three months, he said.
"The value per tonne of steel has come down but volumes are growing over the last couple of months and this should be reflected in our fourth quarter sales revenues. On a ballpark basis, the fourth quarter sales could be estimated at around Rs 250 crore. Sponge iron production and volume have been added in the last quarter. We should be doing a ferrochrome production of 7,000 tonnes this quarter," Agarwal said.
Prices of ferrochrome, which were volatile over the last few months, have been hovering around Rs 35,000-45,000 a tonne.
The company said it will complete the second phase of the capacity addition at the DRI unit by fiscal-end. And once the second phase of the power plant, which currently has a capacity of 25 mw, is on stream, Visa Steel would partly sell the power to the Orissa grid."We've suffered a foreign exchange loss of Rs 24.75 crore in the third quarter while importing coal. From next year onwards, we should have no foreign exchange losses," Agarwal said.
Source: DNA India
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