Jin­dal Stain­less makes value-added prod­ucts

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Jin­dal Stain­less, one of the largest stain­less-steel con­glom­er­ates in In­dia, is con­cen­trat­ing more on val­ueadded goods, as there is a lot of growth for stain­less steel seg­ment in the coun­try. The steel gi­ant is also in­vest­ing in its Orissa fa­cil­ity for the same. “This is due to the growth hap­pen­ing in our coun­try and we are align­ing ac­cord­ing to it,” Vi­jay Sharma, Se­nior Vice Pres­i­dent, Head, Sales & Dis­tri­bu­tion (Do­mes­tic & Ex­ports), Jin­dal Stain­less Cor­po­rate Man­age­ment Ser­vices Pvt. Ltd, said.

Founded by O P Jin­dal in 1970, the com­pany ranks among the top 10 stain­less steel firms in the world. Jin­dal Stain­less has been a part­ner of the In­dian Rail­ways for more than 12 years and it is pre­sent al­most ev­ery­where. “Be it the wag­ons, coaches, met­ros, we are pre­sent ev­ery­where. To give bet­ter ser­vice to our cus­tomers in au­to­mo­bile and rail­ways, we also have a very strong dis­tri­bu­tion net­work,” he said.

With the tar­get of in­creas­ing the per capita con­sump­tion in 2-3 years, the Haryana-based com­pany plays a ma­jor role in build­ing wag­ons and coaches at ICF. Sharma says that they are the right part­ners and are fully equipped for the forth­com­ing new prod­ucts. “In any coach, there are mul­ti­ple ap­pli­ca­tions of stain­less steel that in­cludes body, un­der­frame, side­wall, toi­lets, etc. What­ever stain­less steel is re­quired we have the cus­tomer base who are the ven­dors of rail­ways. Our share in coaches is more than 70%. To­tal value on all rail­ways put to­gether is around 10,000 tonne per month which is around Rs 150 crore. This is the value of stain­less steel only,” he said.

With the new Linke Hof­mann Busch (LHB) coaches com­ing to In­dia, Jin­dal will also be a part of it. Speak­ing about the de­mand for the new de­sign by the Rail­ways, he says, “It is not a new de­sign. It was Ger­man de­sign which the Rail­ways have adopted. It has a unique de­sign if there is a crash, the coaches don’t run into each other. Stain­less steel is very crit­i­cal in this. In one LHB coach there are around 11-12 tonne of stain­less steel, ei­ther coil sheet form or the other. Around 3200 of such coaches were made so far and by 2020 this num­ber will go up to 8000 coaches across In­dia.”

The stain­less-steel com­pany ex­pects its growth to be around the world 5%, whereas in In­dia dur­ing the last 5 years growth has been more than 10%. The growth is in a very nascent stage and Rail­ways plays a ma­jor role in it. “Growth in terms of vol­ume is im­por­tant. Rev­enue is also im­por­tant, and it is based on the com­mod­ity in­dex. It is the growth of the coaches and this growth is ex­po­nen­tial in the next 4 years. In the next 2 years, the new prod­uct will get de­vel­oped and again in the next 2 years it will get dou­bled. Our shares also will go up,” he added.

He said that some of the steel grades that Jin­dal pro­duces for the Rail­ways are very typ­i­cal. They have in­vested a lot in these grades that the In­dian Rail­ways need. As the Rail­ways is fo­cus­ing to make in In­dia and as a stain­less-steel man­u­fac­turer, Jin­dal is sup­port­ing it. Adding more on the in­vest­ment, Sharma said, “Stain­less steel’s first ca­pac­ity melt­ing, and we have got 1.8 mil­lion tonne of it. An­other ca­pac­ity is for mak­ing prod­ucts like hot rolling, cold rolling, and other com­plex fea­tures. This spe­cific fa­cil­ity is used for a spe­cific grade which the rail­ways de­vel­oped along with the in­dus­try. We have in­vested around Rs 60-70 crore for it. We are also in the process of new in­vest­ments.”

With the to­tal pro­duc­tion for a

month at an av­er­age of 130 thou­sand tonne, Jin­dal sup­plies around 1011 thou­sand tonne per month to the Rail­ways. This is around 70% of its cur­rent re­quire­ment. Be­ing a pri­vate player, the steel com­pany is agile, flex­i­ble and fully com­mit­ted. As of March 2018, Jin­dal Stain­less Group has an an­nual crude steel ca­pac­ity of 1.8 MTPA and the group has an an­nual turnover of US $ 3.1 bil­lion. The com­pany holds a mar­ket share of 63% in In­dia and also ex­ports around 20% glob­ally.

Over the past 2 decades, stain­less steel con­sump­tion in In­dia has moved away from the most pri­mary us­age in cook­ware/ durable to new value added cat­e­gories of ar­chi­tec­ture, build­ings, in­fra­struc­ture and process in­dus­tries. The change is fol­low­ing global pat­tern of coun­tries where per capita in­comes of de­vel­op­ing coun­tries are cat­a­pult­ing in line with de­vel­oped coun­tries. “The global per capita con­sump­tion of stain­less steel is around 5 kg and in In­dia, it is 2 kg. There is a huge op­por­tu­nity as the per capita con­sump­tion might in­crease in In­dia and it is still at a nascent stage across var­i­ous in­dus­tries. The process in­dus­tries are lag­ging a bit, but as our GDP is grow­ing we feel that per capita might in­crease.”

On the threat from alu­minium, Sharma said that ev­ery el­e­ment has its own ad­van­tages. There are 5 most im­por­tant el­e­ments, namely stain­less steel, alu­minium, car­bon steel, cop­per, and brass. Stain­less steel is grow­ing at 5% CAGR, while alu­minium is half of this and car­bon is much less. This mainly is due to the ver­sa­til­ity of the ma­te­rial and mul­ti­ple ap­pli­ca­tion vari­ants it goes in. This is one of the main rea­sons that stain­less steel is be­ing ac­cepted world­wide.

Speak­ing more about the In­dian mar­ket, the spokesper­son states that there are 2 dif­fer­ent stain­less steels in In­dia, flat prod­ucts, and long prod­ucts. “Long prod­ucts are used glob­ally. In In­dia around 20% of the prod­ucts are long and 80% are flat prod­ucts. The size of

flat prod­ucts is around 2.4 mil­lion tonne per an­num. Putting to­gether with long prod­ucts it is 3 mil­lion tonne per an­num of pro­duc­tion and con­sump­tion. As a coun­try, In­dia is the sec­ond largest pro­ducer of stain­less steel in the world af­ter China,” he said.

Apart from the rail­way sec­tor the com­pany has its pres­ence in the au­to­mo­tive sec­tor. In In­dia, stain­less steel in au­to­mo­biles is pri­mar­ily used for ex­haust pipes and disc plates. A very few are used in high-end ve­hi­cles for seat belt buckle, door han­dle knob etc. In this seg­ment, Jin­dal holds more than 50% share.

“In com­mer­cial ve­hi­cles, so far there is no com­pul­sion from the gov­ern­ment to use stain­less steel in the ex­haust. But with BS-VI they will be forced to use it. For high com­bus­tion and to en­sure min­i­mum pol­lu­tion, stain­less steel will be used as it is the only al­ter­na­tive. And, we have started an ini­tia­tive, in con­vert­ing the tra­di­tional bus body which used to be in car­bon steel and has less life to con­vert it to right grade of stain­less steel. Many more of such ini­tia­tives are be­ing car­ried out. With this, there is no re­quire­ment of paint also,” Sharma said.

Speak­ing about the dif­fer­ence be­tween In­dian and other coun­try’s steel, Sharma says that in ev­ery coun­try the lo­cal player should al­ways get a pre­mium. Chi­nese peo­ple dump and dis­rupt the mar­ket. “We are ex­port­ing about 20% and with this, we are able to bench­mark our­selves with best play­ers in the global mar­ket. We are just a notch be­low them. In­dian mar­ket is where we are and our pas­sion is here,” he said.

Stain­less steel is an al­loy of steel with chromium con­tent by mass of min­i­mum 10.5% hav­ing cor­ro­sion re­sis­tance prop­er­ties and pro­duced in in­duc­tion fur­nace. Along with chromium, other met­als like nickel & molyb­de­num are added to en­hance prop­er­ties like hard­en­ing, cor­ro­sion re­sis­tance, heat treat­ment, machin­abil­ity, etc. Stain­less steel has a wide range of ap­pli­ca­tions - cook­ware, med­i­cal in­stru­ments, ra­zor blades, high­end ap­pli­ca­tions in seam­less tubes for process in­dus­tries, ther­mal power, au­to­mo­biles, build­ing & con­struc­tion, rail­ways, etc. It has been the fastest grow­ing metal over the past 4 decades, sur­pass­ing all the other im­por­tant met­als/al­loys by a sig­nif­i­cant mar­gin.

Vi­jay Sharma, Se­nior Vice Pres­i­dent, Head, Sales & Dis­tri­bu­tion (Do­mes­tic & Ex­ports), Jin­dal Stain­less Cor­po­rate Man­age­ment Ser­vices Pvt. Ltd.

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