What impact on finished steel production cost does an actual merger of the two companies have?
Jisco is a manufacturer of value-added steel products and as such is vulnerable to steel prices. The merger will help minimise this phenomenon. Also, benefits of economics of scale will reduce the cost of production. Currently, Jisco and JVSL are standalone players with good EBITA (earnings before interest, tax and amortisation) margins in the industry. Also in certain parameters such as productivity, refractory consumption, we are close to the world’s best parameters. We are confident that in the near future, Jisco and JVSL will be one of the most cost-efficient producers of steel in the world. The rising trend in steel prices has hurt steel consumers to the point that calls for low import duty on steel have poured in. Should the duties be relaxed, how resilient would Indian steel producers in general, and Jisco & JVSL in particular, be? The Indian steel industry has now become a global player and is exporting its products worldwide. The price policy of Indian steel companies is large
