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SAIL easy on short-term plans, long term in doubt

Business

Undeterred by a slowdown squeeze, public sector Steel Authority of India Ltd (SAIL) is going ahead with its Rs54,000-crore expansion plans, with no funds problem seen.

It has announced its ability to raise capital whenever needed and that its short term expansion plans are on track.

Half of the money needed to ramp up capacity to 26.2 million tonnes from the current 15 million tonnes would be through external borrowings. The capital will not be raised before the next fiscal year.

SAIL is cautious on the long term, with prices falling by more than 30% over the past three months and signs of a cycle reversal seen in the industry. That means the company’s 2020 target of achieving a target of 60 million tonnes could get affected.

SAIL expressed hope that the only solution in such times was if infrastructure picked up again and keeps growing.

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