Jindal Stainless eyes revenue boost from railways’ demand for steel wagons and coaches

KOLKATA: Jindal Stainless, the country’s largest producer of stainless steel, is hoping to benefit from the railways’ decision to step up intake of stainless steel wagons and coaches by 2020.“This year alone, the railways are likely to procure some 10,000-11,000 wagons. We hope to supply 80% share of the steel for it,” said Vijay Sharma, head of sales at JSL, which is part of the Ratan Jindal group.The domestic market for stainless steel, pegged at 2.4 million tonnes (mt), has been growing at 9-10% over the last few years. This is likely to shoot up to 13-14% per year, largely due to the railways and the advent of BS-VI norms in the automobile sector, which will increase use of stainless steel in automobile manufacturing from the current level of 1.2 lakh tonnes per annum.At present, Indian Railways and metro rail corporations procure stainless steel wagons and coaches worth nearly Rs 2,500 crore. JSL, on an average, meets 70% of this order. “This year, we are targeting 80% of stainless steel out of the wagon order,” Sharma told ET.Stainless steel wagons, which are preferred for carrying mineral ores and coal, are fast replacing the old worn-out carriages. Currently, wagons account for about a fifth of railways’ annual stainless steel bill of Rs 2,500 crore. This is set to go up to Rs 3,500-4,000 crore by 2020.Also, with the railways mandate for use of stainless steel in all new passenger coaches by 2020, it is likely to double its coach order to 5,000 per year from an average 2,500 now. Each coach requires about 10 tonnes of stainless steel.JSL, with a melt capacity of 1.6 mtpa, is targeting a larger presence in the eastern region, and is adding nearly two lakh tonnes of cold rolling facility at its plant in Jajpur, Odisha, in the next 8-10 months, he said.The company is also planning to set up a Rs 250-crore industrial park adjacent to the unit to boost downstream ecosystem in stainless steel. This would include pipes and tubes, auto components and a service centre, Sharma said.

from Economic Times https://ift.tt/2Po296I