Notwithstanding the attempts by global steel giants like ArcelorMittal and POSCO in the country, Indian domestic steel firms are still better placed to grow in the lucrative Indian steel market.
Global research firm Macquarie in a research note said that "We believe that domestic steel companies are better placed to grow given the issues faced by most multi nationals trying to enter the Indian market.”
Domestic steel firms are well poised as even after 3 to 4 years of announcing large steel projects of 12 million tonnes per annum each South Korean steel major POSCO and ArcelorMittal are still struggling to enter the Indian steel market directly.
Macquarie said that despite full support of the central government, these projects have hardly made any headway. The issues involved are allocation of resources, land acquisitions and environmental clearances.
At a time when hurdles are being faced by global biggies, domestic firms like including TATA Steel, SAIL, JSW Steel, Uttam Galva, Electrosteel Casting and Monnet Ispat are pursuing large projects.
Macquarie said that "Many small steel companies, like Electrosteel Casting, Monnet Ispat etc have cornered large iron ore and coal resources and are pursuing large steel projects.”
The report said that besides with the demand for cars, bridges and roads rising, the prospects of Indian steel industry, which is the second fastest growing steel market globally with cheap availability of iron ore, looks very promising and makes it an ideal destination for steel production.
(Sourced from http://www.steelguru.com/news/index/2009/09/15/MTExNzQ0/Indian_steel_company_better_placed_than_global_players_-_Macquarie.html)
Monday, September 14, 2009
Indian steel company better placed than global players - Macquarie
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