Working Capital Management at Steel Authority of India Limited
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Code : FCF0023
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Region : India
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SAILING IN ROUGH WINDS: Rayansh figured out that SAIL had a sales turnover of INR 511.29 billion during 2014-15, which was 2% lower than the previous year (Refer to Exhibit – IV). A lower sales volume was the prime cause for the decline. Steel prices, which were soaring at the beginning of 2014-15, had started to gradually decline in September 2014. They hit a rock-bottom at the end of the financial year 2014-15.The profit after tax during 2014-15 was INR 20.93 billion as compared to INR 26.16 billion in the previous financial year. HISTORY OF SAIL: The foundation of SAIL was laid in the early years after India became independent. The leaders of emerging and newly independent nation envisioned that in order to lay a strong foundation for the growth and strength of the country, they needed to focus on infrastructure and rapid industrialization in the country. |
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THE EMERGENCE OF SAIL:
The Rourkela steel plant was the only steel company under the management of Hindustan Steel. The Iron and Steel Ministry of India took charge of the Bhilai and Durgapur Steel Plants. Later, in April 1957, the supervision and control of these two steel plants were also transferred to Hindustan Steel. In December 1961, the 1 MT phase of the Bhilai and Rourkela Steel Plants was completed and in January 1962, the 1 MT phase of Durgapur Steel Plant was also completed. Bokaro Steel Limited, another unit at Bokaro, was incorporated in January 1964.
THE STEEL MANUFACTURING PROCESS:
Rayansh had a look at the steel manufacturing process of SAIL (Refer to Exhibit – V). The Raw Materials and Material Handling Plant received, blended, stored, and supplied different raw materials to the Blast Furnace, Sinter Plant, and Refractory Materials Plant as per their requirements. It also maintained a buffer stock to take care of any supply interruptions. The Coke Oven Complex converted prime coking coal and medium coking coal from various mines (Jharia, Dugda, Moonidih, Kargali, Kathara, Mahuda, etc.) blended with imported coal into high quality coke for the Blast Furnaces, and also recovered valuable by-products like Anthracene Oil, Benzene, Toluene, Xylene, Light Solvent Naphtha, Ammonium Sulphate, and Extra-hard Pitch in the process. Blast Furnaces that produced molten iron – Hot Metal – for steelmaking used Bell-less Top Charging, modernized double cast houses, coal dust injection and cast house slag granulation technologies. The process of iron-making was automated, using the PLC Charging System and the Computer Controlled Supervision System. Waste products like the Blast Furnace slag and gas were either used directly within the plant or processed for recycling / re-use.
INDUSTRY OUTLOOK:
The industry performance depended on the recovery of global markets. The domestic demand was predicted to improve the situation of steel companies.
EXHIBITS:
Exhibit – I: Integrated Steel Plants of SAIL
Exhibit – II: Statement of Profit and Loss of SAIL
Exhibit – III: Schedule of Inventory at SAIL
Exhibit – IV: Statement of Profit and Loss of SAIL
Exhibit – V:Process Flow of Steel Manufacturing
