Rashtriya Ispat Nigam Ltd (Vizag Steel) is planning to focus more on exports to weather the currency crisis. “It is also necessary in the long term, as we have to import some critical inputs like coking coal,” said T.K. Chand, Director (Commercial), RINL.
Chand, who took over as the Chairman of the Visakhapatnam chapter of the Computer Society of India here last week, said the drastic slump of the rupee would have some impact on RINL.
“Of course, we have taken recourse to hedging and for the next six months there may not be much of a problem. But then we have to pay for hedging the risk as well,” he said.
It would be necessary for the company to focus on exports not only as a short-term measure but as a long-term strategy as well to pay for its imports, Chand said. He further said India was a net importer of steel to the extent of 5-6 million tonnes and “therefore in the present scenario there may also be a temporary surge in demand for domestic steel, as we may not be able to import steel.” According to Chand, RINL is presently exporting only 7-8 per cent of its production but it may have to go up to 20 per cent or so in the future. “We are exploring overseas markets such as South-East Asia. Our company's long products have a good brand image,” he added.
The proposed bifurcation of Andhra Pradesh may have some impact, he said, as the company would have to pay CST (central sales tax) on steel sold in Telangana. sarma.rs@thehindu.co.in