India Steel Industry Report - H1, 2013
This report provides an overview of India’s steel industry, discussing trends in the sector through H1 2013 and analyzing the market forecast through 2014. The report also review the market position of leading players including SAIL, JSW, and Tata Steel.
The Indian steel industry witnessed a major demand slowdown in FY13 after a decade of high growth. The slowdown in Chinese steel demand created a problem of global oversupply, which caused a decline in global steel prices. The differential in domestic and global steel prices triggered an increase in steel imports, negatively affecting domestic producers and subsequently bringing domestic prices down. Steel consumption in the country was subdued even in the first five months of FY14. Declines in profitability, depreciation of the rupee, rising inventories, increased finance costs, foreign exchange losses, and a ban on iron ore mining were some of the other issues that hurt domestic steel producers in the first half of 2013.
Rising imports, difficulty in resource mobilization, and the global slowdown in steel demand have emerged as the major threats for this sector. However, the outlook for India’s steel industry is stable in the medium term owing to a low per capita steel consumption and a largely untapped rural market.
Key Points:
The Indian steel industry witnessed a major demand slowdown in FY13 after a decade of high growth. The slowdown in Chinese steel demand created a problem of global oversupply, which caused a decline in global steel prices. The differential in domestic and global steel prices triggered an increase in steel imports, negatively affecting domestic producers and subsequently bringing domestic prices down. Steel consumption in the country was subdued even in the first five months of FY14. Declines in profitability, depreciation of the rupee, rising inventories, increased finance costs, foreign exchange losses, and a ban on iron ore mining were some of the other issues that hurt domestic steel producers in the first half of 2013.
Rising imports, difficulty in resource mobilization, and the global slowdown in steel demand have emerged as the major threats for this sector. However, the outlook for India’s steel industry is stable in the medium term owing to a low per capita steel consumption and a largely untapped rural market.
Key Points:
- This report includes financial highlights and a comparative matrix for key sectoral players including the Steel Authority of India Ltd (SAIL), JSW Steel Limited (JSW), and Tata Steel Limited (Tata Steel).
- Total finished steel consumption grew at a CAGR of 10.8% during the last decade. By contrast, FY13 consumption grew by 3.3%, the second-lowest growth figure in the past ten years.
- SAIL, Tata Steel, Jindal South West Steel (JSW), Rashtriya Ispat Nigam Limited (RINL), Essar Steel, and Jindal Steel & Power Limited (JSPL) accounted for more than 55% of the country’s crude steel production in FY2013.
- Total crude steel production capacity grew at a CAGR of around 9% during the last five years. The average capacity utilization during this period was around 87%.
- Total crude steel production grew at a CAGR of 10.1% during 2007–13. The finished steel production grew at a CAGR of 11.2% during the same period. However, a subdued growth of 5% in crude steel production was recorded during FY13 due to the faltering demand.
1. INDUSTRY PROFILE
1.1 Sector overview
1.2 Sector size
1.3 Competitive landscape
1.4 Environmental scanning
2. MARKET TRENDS AND OUTLOOK
2.1 Key economic indicators-India
2.2 Steel production capacity
2.3 Steel production
2.4 Steel demand
2.5 Steel exports
2.6 Steel imports
2.7 Steel prices
2.8 Raw materials
2.9 Pig iron
2.10 Sponge iron
2.11 Industry forecast
3. LEADING PLAYERS AND COMPARATIVE MATRIX
3.1 Leading players
3.1.1 Steel Authority of India Ltd (SAIL)
3.1.2 JSW Steel Limited (JSW)
3.1.3 Tata Steel Limited (Tata Steel)
3.2 Comparative matrix
3.3 SWOT analysis
4. TABLES & CHARTS
Table 1: Share of public and private sector in country's crude steel production
Table 2: Key issues to be addressed in the new draft national steel policy
Table 3: Key financial ratios of leading players
Chart 1: Real consumption of total finished steel in India
Chart 2: World crude steel production
Chart 3: Per capita steel consumption by country in 2012
Chart 4: Annual revenues of leading Indian steel players-FY13
Chart 5: Market share of leading players based on annual revenue
Chart 6: Position of constituent parties in lower house of parliament
Chart 7: Current account deficit and fiscal deficit
Chart 8: Per capita steel consumption- India
Chart 9: Process used in Indian steel production
Chart 10: Quarterly GDP Growth Rate
Chart 11: Average Monthly USD to INR Exchange Rate
Chart 12: Inflation in India
Chart 13: Y/Y change in Index of Industrial Production
Chart 14: Contribution of eight core industries in IIP by weights
Chart 15: Y/Y growth-Production indices of eight core industries
Chart 16: Steel production capacity in the country
Chart 17: Planned capacity expansion by 2020 in different states
Chart 18: Steel production in the country
Chart 19: Steel production growth in the country
Chart 20: Breakup of steel production by companies
Chart 21: Breakup of steel production by companies
Chart 22: Annual production surplus of finished steel in India
Chart 23: Finished steel demand and supply
Chart 24: Steel exports from India
Chart 25: Net exports of finished steel from India
Chart 26: Steel imports in India
Chart 27: Estimated surplus of finished steel in India
Chart 28: Price of steel hot rolled coil
Chart 29: Domestic price index of steel products in India
Chart 30: Annual iron-ore exports from India
Chart 31: Production of pig iron in India
Chart 32: Production of sponge iron in India
Chart 33: Forecast for consumption of finished steel in India
Chart 34: Annual saleable steel produced by SAIL
Chart 35: Net sales of SAIL-Annual
Chart 36: Profit margins of SAIL
Chart 37: Annual saleable steel produced by JSW
Chart 38: Net sales of JSW-Annual
Chart 39: Profit margins of JSW
Chart 40: Annual saleable steel produced by Tata Steel
Chart 41: Turnover of Tata Steel-Annual
Chart 42: Profit margins of Tata Steel
1.1 Sector overview
1.2 Sector size
1.3 Competitive landscape
1.4 Environmental scanning
2. MARKET TRENDS AND OUTLOOK
2.1 Key economic indicators-India
2.2 Steel production capacity
2.3 Steel production
2.4 Steel demand
2.5 Steel exports
2.6 Steel imports
2.7 Steel prices
2.8 Raw materials
2.9 Pig iron
2.10 Sponge iron
2.11 Industry forecast
3. LEADING PLAYERS AND COMPARATIVE MATRIX
3.1 Leading players
3.1.1 Steel Authority of India Ltd (SAIL)
3.1.2 JSW Steel Limited (JSW)
3.1.3 Tata Steel Limited (Tata Steel)
3.2 Comparative matrix
3.3 SWOT analysis
4. TABLES & CHARTS
Table 1: Share of public and private sector in country's crude steel production
Table 2: Key issues to be addressed in the new draft national steel policy
Table 3: Key financial ratios of leading players
Chart 1: Real consumption of total finished steel in India
Chart 2: World crude steel production
Chart 3: Per capita steel consumption by country in 2012
Chart 4: Annual revenues of leading Indian steel players-FY13
Chart 5: Market share of leading players based on annual revenue
Chart 6: Position of constituent parties in lower house of parliament
Chart 7: Current account deficit and fiscal deficit
Chart 8: Per capita steel consumption- India
Chart 9: Process used in Indian steel production
Chart 10: Quarterly GDP Growth Rate
Chart 11: Average Monthly USD to INR Exchange Rate
Chart 12: Inflation in India
Chart 13: Y/Y change in Index of Industrial Production
Chart 14: Contribution of eight core industries in IIP by weights
Chart 15: Y/Y growth-Production indices of eight core industries
Chart 16: Steel production capacity in the country
Chart 17: Planned capacity expansion by 2020 in different states
Chart 18: Steel production in the country
Chart 19: Steel production growth in the country
Chart 20: Breakup of steel production by companies
Chart 21: Breakup of steel production by companies
Chart 22: Annual production surplus of finished steel in India
Chart 23: Finished steel demand and supply
Chart 24: Steel exports from India
Chart 25: Net exports of finished steel from India
Chart 26: Steel imports in India
Chart 27: Estimated surplus of finished steel in India
Chart 28: Price of steel hot rolled coil
Chart 29: Domestic price index of steel products in India
Chart 30: Annual iron-ore exports from India
Chart 31: Production of pig iron in India
Chart 32: Production of sponge iron in India
Chart 33: Forecast for consumption of finished steel in India
Chart 34: Annual saleable steel produced by SAIL
Chart 35: Net sales of SAIL-Annual
Chart 36: Profit margins of SAIL
Chart 37: Annual saleable steel produced by JSW
Chart 38: Net sales of JSW-Annual
Chart 39: Profit margins of JSW
Chart 40: Annual saleable steel produced by Tata Steel
Chart 41: Turnover of Tata Steel-Annual
Chart 42: Profit margins of Tata Steel
