Wednesday, October 24, 2007

The smiles are finally back in the sector... or are they???

DespiteThe smiles are finally back in the sector... or are they??? their proven metal reserves, the cities of Bokaro, Bhilai, Rourkela & Bellary were largely labelled as qualmish, putrid, bygone & defunct till even the dawn of this century. For long, companies in these regions were performing feebly and were deep in the red, even going to the brink of bankruptcy, exacerbated by the downturn in the sector. This compelled analysts & to write-off this highly capital intensive metal industry and be largely cynical about the comeback potential of this metal industry, especially after the IT boom took over across India.

However, the so called old-world metal sector is back with a bang, breaking all myths and qualms surrounding it. With metal czars scoring astounding profits and announcing elephantine capex plans, all the scepticism from the sector has been alienated and these townships have received a spanking new lease of life. In fact, most of the companies posted their highest ever sales and profits in FY07.

The maximum number of entries in the elite top ten chart of B&E 100 are from the metal sectors only – SAIL (4), Hindustan Zinc (6) & Tata Steel (7) knocking down sun rise and new world sectors like IT, banking & telecom showcasing its supremacy in the Indian economy. Stated S.K. Roongta, Chairman, SAIL on the performance of the company, “Strong demand for steel, market-driven product- mix, higher value-added special steel production and improved techno-economic parameters helped Steel Authority of India Ltd. (SAIL) to achieve a record turnover...” Right from companies in the ferrous metal index to those operating in non-ferrous topography, all are having a gala time. It is interesting to note that the dynamics which led to the downfall of the sector are the ones that have been responsible for its renaissance as well.

For Complete IIPM Article, Click on IIPM Article

Source :
IIPM Editorial, 2007

IIPM and Professor Arindam Chaudhuri (Renowned Management Guru and Economist) Initiative

For More IIPM Article, Visit Below....

No comments: