Imposition of anti-dumping duties by the government last year, has resulted in curbing the influx of cheaper imports and helped local producers like us.

Saket Jindal, Managing Director,

Maharashtra Seamless Limited

How do you see the demand of steel pipes and tubes in the domestic oil sector?

We have two categories of pipes and tubes: Seamless and ERW. We have significant requirements coming from government PSUs like ONGC. Recently we are expecting an order of 1-lakh tonne valued Rs 750 crore from oil sector. We have other customers in the public sector mainly in the oil and gas, boilers, oil refineries, and onshore and offshore mining. We also see increasing demand in drill pipes segment. Besides, we are exporting to the markets in USA, Canada, North America and in parts of Europe.

Today, as the oil price is increasing, the realisation of steel pipes is going up. So, our margin is also intact. We also have an expansion plan – a new plant is coming up at Mangaon in Maharashtra having the production capacity of 2-lakh tonne per annum. We would produce steel pipes and mechanical tubing at the new greenfield facility.

What will be your total order booking in terms of value?

Today we have around three-months order which will be of around Rs 1,500 crore in value terms.

How much have you invested in the upcoming plant?

The plant has been set up at a relatively low CAPEX with around one-third of the price as per the industry standard. The total investment is about Rs 350 crores. It will give us a considerable capacity expansion and increased foothold in a market share.

What are the major difficulties faced in getting the government orders?

We are not facing any difficulties – in fact we are in a more comfortable position now. Imposition of anti-dumping duties by the government last year, has resulted in curbing the influx of cheaper imports and helped local producers like us. Earlier, Chinese companies were enjoying almost 90 per cent of the market share in the oil sector especially from ONGC. Now, post anti-dumping duties is imposed, MSL is getting their 100 per cent orders.

How it has impacted on your financial performance?

The pipes that we were selling for US$ 500-600 per tonne, now it costs US$ 1,000. So, we are getting better realisation.

Could you let us know more about your presence in the export markets?

We have started exporting to Canada and Latin America which is giving us significant profit. The US market has been dull for some time and we are concentrating more in Canada market as the realisation in Canada is far better than the USA. So, whichever market gives us better realisation, we will focus on that market.

What are the core objectives you would like to achieve in 2018?

We would like to streamline our new expansion. We would focus on reducing the costs and lead time by enhancing operation efficiency. We would also plan to get increase out footprint in overseas markets.

Which product segment will give you the better business in 2018?Is it going to be seamless only?

Yes, seamless is our major chunk of the turnover. So, naturally the contribution of seamless will be higher. Also, with the anti-dumping duties in place, we expect better business realisation.

Apart from investing in capacity expansion, do you have any other investment plan in pipeline?

We have set up a 20 MW solar power plants with NTPC in Rajasthan. Similarly, we are planning a captive solar power plant in our Maharashtra facility with an investment of Rs 70 crore.  This will help us to further bring down our operating expenditure.