B&E: How did you prepare yourself for the slowdown in demand last year?
VG: We were among the early risers to the deteriorating conditions. However, since JSPL’s product range includes both long and flat products we were well placed to optimize our product mix in consort with changing market realities and thereby protect our bottom-lines. Among other enabling factors have been our high retained earnings and low debt.
B&E: Mostly, analysts say that India Inc. has managed profitability through extensive cost cutting...
VG: We rode out the global storm with a game plan focused on both cost-cutting and creativity without reducing production. Ideas gleaned from shop floor workers were aggressively sought out and implemented. In addition, we engaged some of the best consulting firms in key niche areas, like Accenture, McKinsey and Hewitt. All around the thrust was on encouraging creative thought and economizing through enhanced efficiencies.
B&E: How secure do you feel w.r.t. resources?
VG: In the current business milieu no company in our space can hope to survive without robust backward integration. JSPL has always believed in this and assiduously built dedicated sources for key raw materials (ore, power and coal) in keeping with the integrated steel producer model, which is widely regarded as the most efficient in the industry. Among other advantages, this model insulates us against industry cycles.
B&E: Are you seeing the demand situation reviving now?
VG: The real, big recovery is still some distance away. However, there are encouraging signs of demand picking up. This is evident from the fact that prices have increased by about 8-10% in the domestic market and 7 to 8% globally. Besides, there has been a considerable increase in business enquiries from Southeast Asia and the Middle-East—all signs of better times.
VG: We were among the early risers to the deteriorating conditions. However, since JSPL’s product range includes both long and flat products we were well placed to optimize our product mix in consort with changing market realities and thereby protect our bottom-lines. Among other enabling factors have been our high retained earnings and low debt.
B&E: Mostly, analysts say that India Inc. has managed profitability through extensive cost cutting...
VG: We rode out the global storm with a game plan focused on both cost-cutting and creativity without reducing production. Ideas gleaned from shop floor workers were aggressively sought out and implemented. In addition, we engaged some of the best consulting firms in key niche areas, like Accenture, McKinsey and Hewitt. All around the thrust was on encouraging creative thought and economizing through enhanced efficiencies.
B&E: How secure do you feel w.r.t. resources?
VG: In the current business milieu no company in our space can hope to survive without robust backward integration. JSPL has always believed in this and assiduously built dedicated sources for key raw materials (ore, power and coal) in keeping with the integrated steel producer model, which is widely regarded as the most efficient in the industry. Among other advantages, this model insulates us against industry cycles.
B&E: Are you seeing the demand situation reviving now?
VG: The real, big recovery is still some distance away. However, there are encouraging signs of demand picking up. This is evident from the fact that prices have increased by about 8-10% in the domestic market and 7 to 8% globally. Besides, there has been a considerable increase in business enquiries from Southeast Asia and the Middle-East—all signs of better times.
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