The flagship company of HIRA Group, Godawari Power and Ispat is majorly into the production of iron and steel. Its other interests include mining, power, engineering, renewable energy, solar power and water conservation equipment. BL Agrawal, Managing Director, Godawari Power and Ispat, shares more...
Please highlight one major challenge faced in FY2017-18.
Our company Godawari Power and Ispat has two iron ore mines in Chhattisgarh under its portfolio. We have been trying to extract the resources from these two mines to their optimal capacity, but were not able to till October 2016. We changed MDOs in October 2016, got the study done by MECON and revamped the production from a meagre 10-11 lakh tonne per annum in 2016-17 to 15-16 lakh tonne per annum in 2017-18. This has not only given us an edge over other steel players in the market in the state and around, but helped us use our production capacity of pellet, sponge and steel to its maximum. We are at an all time high on these numbers in 2017-18, mainly in the last two quarters.
What decision do you consider the biggest contributor to the company's growth in FY17-18?
The biggest contributors to our numbers for 2017-18 are mining capacity enhancement, substantial increase in pellet production and export of pellet to countries like China. Further, reducing the cost of procuring raw material from various sources, which was also reduced as our mine production increased, and captive availability of iron ore have had a major impact on our last two quarter numbers.
Please share a decision you avoided, which could have otherwise impacted the company's top-line and bottom-line.
Maintaining cash flow to pay for bank loans help reduce debt levels and having no major expansion have helped us improve our bottomline and topline.
Going forward, what are your plans for the company's growth in FY18-19?
We have no major plans for expansion. Going forward, we would like to reach the optimal capacity of our processes, for which we are putting up a 3 lakh tonne per annum rolling mill this year on hot charging basis and one of the group company which has a 25 Mw thermal power plant is being captive.
This will increase our power production by 10 per cent at least and will have a positive impact on revenue. We are also adding to our capacity of steel production, increasing it from 2 lakh tonne per annum to 4 lakh tonne per annum so that we are able to consume pellet and, hence, the sponge in house rather than going to the market. This will obviously increase overall revenue. We are looking for complete integration in 2018-19.