1

SYNOPSIS

Jindal Steel and Power Limited (JSPL) is

one of India’s major steel producers

with a significant presence in sectors

like Mining, Power Generation and

Infrastructure.

Company’s annual turnover of over US

$2.9 billion.

The Company has acquired Shadeed

Iron & Steel Co. LLC (SISCO), Oman, in

June, 2010. SISCO is setting up a 1.5

MTPA gas based DRI plant in Oman.

JSPL has consistently tapped new

opportunities by increasing production

capacity, diversifying investments, and

leveraging its core capabilities to

venture into new businesses.

Orissa steel plant Expansion with an

investment of over US $ 8.00 billion (Rs.

40,000 crore). The first phase of 3

million tonne is expected to be

commissioned by 2011.

Net Sales and PAT of the company are

expected to grow at a CAGR of 15% and

9% over 2010 to 2013E respectively.

Years Net sales EBITDA Net Profit EPS P/E

FY 11 131116.00 64746.00 38040.10 40.18 15.68

FY 12E 149472.24 72648.68 42710.66 45.73 13.78

FY 13E 167408.91 80511.43 47075.91 50.41 12.50

Stock Data:

Sector: Steel

Face Value Rs. Rs.1.00

52 wk. High/Low (Rs.) 755.25/572.70

Volume (2 wk. Avg.) 79000

BSE Code 532286

Market Cap (Rs.In mn) 588357.00

Share Holding Pattern

1 Year Comparative Graph

Jindal Steel & Power

Ltd BSE SENSEX

C.M.P : Rs.630.00 Target Price : Rs.718.00 Date : 10th June 2011 BUY

JINDAL STEEL & POWER LTD

Result Update: Q4 FY 11

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Peer Group Comparison

Name of the company CMP(Rs.) Market

Cap.(Rs.Mn.) EPS(Rs.) P/E(x) P/Bv(x) Dividend (%)

Jindal Steel 630.00 588357.00 40.18 15.68 4.16 125.00

SAIL 144.60 597255.9 11.82 12.23 1.56 33.00

Ispat Indus 20.85 49764.8 - - 6.58 0.00

JSL Stainless 105.90 19836.7 16.99 6.23 1.04 0.00

Investment Highlights

Q4 FY11 Results Update

Jindal Steel & Power Ltd disclosed results for the quarter ended March 2011. Net

sales for the quarter moved up 21% to Rs.38545.40 million as compared to

Rs.31755.90 million during the corresponding quarter last year. Total Income has

increased from Rs 32058.90 million for the quarter ended March 31, 2010 to Rs

39151.50 million for the quarter ended March 31, 2011. During the quarter, the

company has reported Net Profit increased to Rs.10017.00 million from

Rs.9633.80 million in previous year same quarter. The Basic EPS of the company

stood at Rs.10.73 for the quarter ended March 2011.

Quarterly Results - Standalone (Rs in mn)

As At March-11 March-10 %change

Net sales 38545.40 31755.90 21

PAT 10017.00 9633.80 4

Basic EPS 10.73 10.35 4

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Basic EPS of the company stood at Rs.10.73

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Break up of Expenditure

Expenditure for the quarter stood at Rs.21271.00mn, which is around 24%

higher than the corresponding period of the previous year. Raw material cost of

the company for the quarter accounts for 27% of the sales of the company and

stood at Rs.10552.80mn from Rs.6243.70mn of the corresponding period of the

previous year. Other Expenditure cost increased 31%YoY to Rs.5679.8mn from

Rs.4329.20mn and accounts for 15% of the revenue of the company for the

quarter.

OPM and NPM for the quarter stood at 46% and 26% respectively from 47% and

30% respectively of the same period of the last year.

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FY11 Performance

Net profit of the company has increased at 3% yoy Rs.37538.80mn from

Rs.36345.60mn of same period of last year. Total revenue for the year stood at

Rs.131116.00 mn from Rs.110915.40 which is 18% increased than that of a year

ago. EPS for the year stood at Rs.40.18 per equity share of Rs.1.00 each.

Operating profit of the company stood at Rs.64746.00mn. OPM for the year stood

at 49.38%. Expenditure of the company increased 28% YoY to Rs.67190.00 mn.

Interest expenses for the year stood at Rs.3355.80mn.

Segment Revenue

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Subsidiary to Set up 2.52 mmtpa MIDREX DRI plant in Bolivia

Jindal Steel & Power (JSPL) announced that its subsidiary Jindal Steel Bolivia

(JSB) will build a 2.52 MMTPA natural-gas-based MIDREX direct

reduction plant at EL-Mutun, Puerto Suarez, Bolivia, and South America. The

project will be known as the Naveen Ultra Mega Mod DRI and will feature the

latest MIDREX Shaft Furnace innovations and will have the flexibility to

produce both quality hot DRI and hot briquetted iron for use in a new proposed

Greenfield melt shop. The contract for this new MIDREX plant was signed on

Mar. 30, 2011.

Iron ore and iron pellets will be supplied from JSB`s EI Mutun Iron Ore

Reserves in Bolivia where JSB is also installing a pellent plant and a steel

making facility. Based on the stellar performance of MIDREX DRI Plants, this

new facility at JSB will be capable of producing more than the rated

capacity. The Naveen Ultra Mega Mod plant can produce up to 2.70 million

metric ton per year of DRI depending upon the quality of inputs, operating

parameters and skill of the workforce.

Board recommends Final Dividend

Jindal Steel & Power Ltd has recommended final dividend @150% i.e. Rupees

1.50 per equity share of Re. 1/- each.

To Acquire Rocklands Richfield

Jindal Steel & Power Ltd is announce its intention, through a step down wholly

owned subsidiary namely, Jindal Steel and Power (Australia) Pty Ltd (JSPA) to

make an on-market takeover offer (Offer) for all of the shares in Rockland’s

Richfield’s Limited (Rockland’s) listed on Australian Stock Exchange (ASX code:

RCI). Under the terms of the Offer, JSPA is offering AUD $ 0.25 cash for every

Rocklands share held. The Offer values Rocklands' total equity at approximately

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AUD $ 88 million. JSPA currently holds a 14.46% interest in Rocklands and

has received approval of Foreign Investment Review Board, Australia to increase

its stake above the 15% threshold.

Allotment of shares under ESOS

Jindal Steel & Power Ltd has allotted 2,40,564 equity shares of Re. 1/- each in

accordance with the terms of Company's Employees Stock Option Scheme

(ESOS-2005). Consequently with effect from April 14, 2011 the issued,

subscribed and paid up share capital of the Company stands increased to Rs.

93,45,09,595/- (Rupees ninety three crores forty five lacs nine thousand five

hundred ninety five only) divided into 93,45,09,595 equity shares of Re. 1/-

each.

Company Profile

Jindal Steel & Power Limited (JSPL) was established in the year 1990 by hiving off

the Raigarh & Raipur Divisions of Jindal Strips Ltd. JSPL forms a part of the $ $12

billion (over Rs. 60,000 crore) Jindal Group. JSPL is a leading player in Steel, Power,

Mining, Oil & Gas and Infrastructure. The company produces economical and

efficient steel and power through backward integration from its own captive coal and

iron-ore mines and passes on the benefits to its customers. Naveen Jindal, the

youngest son of the legendry late O P Jindal, drives JSPL and its group companies

Jindal Power Ltd, Jindal Petroleum Ltd., Jindal Cement Ltd. and Jindal Steel Bolivia.

The O P Jindal Group has emerged as one of India's most dynamic business groups

over the past three decades. Today, the group is a multi-billion, multi-location, multi-

product business empire. From mining iron ore and coal, the group produces sponge

iron, ferro alloys and a wide range of hot-rolled and cold-rolled steel products ranging

from HR coils/sheets/plates, hot-rolled structural sections and rails to CR

coils/sheets, high-grade pipes and value added items such as stainless steel,

galvanized steel & coated pipes. It has not only diversified into power generation but

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also into petroleum, infrastructure, diamond and high value metals & mineral

exploration. The group has manufacturing facilities across India, US & Indonesia and

marketing/representative offices across the globe.

An enterprising spirit and ability to discern future trends have been the driving force

behind the company's remarkable growth. The company has scaled new heights with

the combined force of innovation, adaptation of new technology and the collective

skills of its 15,000 strong, committed workforce. It has won wide acclaim for its

efficient operations and commitment to environment & society.

JSPL has consistently tapped new opportunities by increasing production capacity,

diversifying investments, and leveraging its core capabilities to venture into new

businesses. JSPL’s investment commitments in steel, power, oil & gas and mining

have touched more than $ 30 billion (Rs. 1,50,000 crore). The company, today, is the

largest private sector investor in the state of Chhattisgarh with a total investment

commitment of over $ 6.25 billion (Rs. 31,250 crore).

The company is having altogether eight facilities in India, of which four are in

Chhatisgarh, two in Orissa and one in Jharkhand while its international facility is

located at Bolivia (South America). JSPL is exploring steel production and mining

projects in other parts of the world, such as Mozambique, South Africa, Mongolia,

Brazil and Indonesia. JSPL has diversified into exploration of diamond, gold, precious

stones and other high value metals and minerals in Chhattisgarh, Jharkhand and

Republic of Congo.

Expansion Projects:

Orissa

A 12.5 million tonne integrated steel plant and 2600 MW captive Power Plant in

phases, with an investment of over US $ 8.00 billion (Rs. 40,000 crore). The

first phase of 3 million tonne is expected to be commissioned by 2011.

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Jharkhand

An 11 million tonne integrated steel plant and 2600 MW captive Power Plant in

phases, with an investment of over US $ 6.00 billion (Rs. 30,000 crore).

Chhattisgarh

7 million tonne steel plant, 2 million tonne cement plant and 1600 MW Captive

Power Plant with a total investment of over US $ 5.20 billion (Rs. 26,000 crore).

Jindal Power Limited, a subsidiary of JSPL, is expanding the capacity of its

existing 1000 MW Thermal Power Plant at Tamnar by setting up a 2400 MW

thermal power plant with an investment of US $ 2.40 billion (Rs. 13,410 crore).

Other group company’s are:

JSL Ltd.

Jindal Saw Ltd.

JSW Steel Ltd.

Chhattisgarh Energy Trading Company Limited (CETCL) is an affiliate of Jindal

Steel and Power Limited. It was incorporated in Sept.2008 .Currently CETCL is

category ‘II’ licensee.

Jindal Power Limited - Jindal Power Limited (JPL), an affiliate of JSPL has set

up India’s first mega power project – the 1000 MW O P Jindal Super Thermal

Power Plant at Raigarh, Chhattisgarh.

Product Range of the company includes:

Rails- Giving impetus to the significant rail sector, JSPL has pioneered the

manufacturing of 120 meter long track rails in the Indian sub-continent. The world’s

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longest track rails are a testimony of JSPL’s manufacturing capabilities where

continuous innovation is a practice rather than an exception.

Parallel Flange Sections - JSPL pioneered the production of medium and large size

Hot Rolled Parallel Flange Beams and Column Sections (H-Beams) in India. The

beams are cost effective and provide design-flexibility.

Plates & Coils- JSPL is equipped with India's first 'one of a kind' state-of-the-art

plate mill that produces plates and coils of 3.5 and 3 meters width, respectively, for

the first time in the private sector. The products are of premium quality, owing to its

sound steel refining properties.

Semi-Finished Products- JSPL has a capacity to produce about three million tonnes

per annum of semis which are primarily used for captive use in JSPLs’ 0.75 million

tonne per annum capacity Rail & Universal Beam Mill and 1.0 million tonne per

annum capacity Plate & Stackle Mill. Power- the company started power generation

over a decade back. In the beginning it was a captive power facility using waste heat

from the rotary kiln boilers and the coal rejects of the washery. Over the years

however, Jindal Steel and Power Ltd (JSPL) and its affiliate Jindal Power Ltd. (JPL)

have come up in a big way and are producing about 1400 MW power through both

captive and commercial facilities.

Ferro Chrome - At JSPL, high-grade chrome ore, one of the pre-requisites for making

ferro chrome, is sourced from the captive chrome ore mines in Sukinda Valley of

Orissa.

Sponge Iron - JSPL has world's largest coal-based sponge iron manufacturing facility

and stands out as the market leader in coal-based sponge iron industry within India.

Efficient backward integration has rendered JSPL as the only sponge iron

manufacturer in the country, with its own captive raw material resources and power

generation capacity helping the company to monitor both price and quality of its

products.

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Financial Results

12 Months Ended Profit & Loss Account (Consolidate)

Value(Rs.in million) FY10A FY11A FY12E FY13E

12m 12m 12m 12m

Description

Net Sales 110915.40 131116.00 149472.24 167408.91

Other Income 602.80 820.00 902.00 992.20

Total Income 111518.20 131936.00 150374.24 168401.11

Expenditure -52438.30 -67190.00 -77725.56 -87889.68

Operating Profit 59079.90 64746.00 72648.68 80511.43

Interest -3575.80 -3355.80 -3789.44 -3978.92

Gross Profit 55504.10 61390.20 68859.23 76532.52

Depreciation -9969.60 -11510.00 -12661.00 -14180.32

Profit before Tax 45534.50 49880.20 56198.23 62352.20

Tax -9188.90 -11840.10 -13487.58 -15276.29

Profit after Tax 36345.60 38040.10 42710.66 47075.91

Minority Interest 0.00 -659.10 0.00 0.00

Share of Profit & Loss Asso

0.00 157.80 0.00 0.00

Net profit 36345.60 37538.80 42710.66 47075.91

Equity Capital 931.20 934.30 933.90 933.90

Reserves 98412.00 140557.90 183268.56 230344.46

Face Value(Rs.) 1.00 1.00 1.00 1.00

EPS 39.03 40.18 45.73 50.41

*A=Actual, *E=Estimated

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Quarterly Ended Profit & Loss Account (Consolidate)

Value(Rs.in million) 30-Sep-10 30-Dec-10 30-Mar-11 30-Jun-11

3m(A) 3m(A) 3m(A) 3m(E)

Description

Net Sales 30820.90 31739.90 38545.40 36618.13

Other Income 37.40 87.10 606.10 91.46

Total Income 30858.30 31827.00 39151.50 36709.59

Expenditure -15804.10 -15753.00 -21271.00 -19059.74

Operating Profit 15054.20 16074.00 17880.50 17649.85

Interest -781.80 -812.60 -900.00 -954.00

Gross Profit 14272.40 15261.40 16980.50 16695.85

Depreciation -2730.50 -2925.90 -3344.50 -3277.61

Profit before Tax 11541.90 12335.50 13636.00 13418.24

Tax -2599.50 -2824.50 -3619.00 -3488.74

Profit after Tax 8942.40 9511.00 10017.00 9929.50

Minority Interest 0.00 0.00 0.00 0.00

Share of Profit & Loss Asso

0.00 0.00 0.00 0.00

Net Profit 8,942.40 9,511.00 10,017.00 9,929.50

Equity Capital 933.90 933.90 933.90 933.90

Face Value(Rs.) 1.00 1.00 1.00 1.00

EPS 9.58 10.18 10.73 10.63

*A=Actual, *E=Estimated

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Key Ratio

Particulars FY10 FY11 FY12E FY13E

EPS (Rs.) 39.03 40.18 45.73 50.41

EBITDA Margin (%) 53.27% 49.38% 48.60% 48.09%

PAT Margin (%) 32.77% 29.01% 28.57% 28.12%

P/E Ratio (x) 16.14 15.68 13.78 12.5

ROE (%) 36.59% 26.88% 23.19% 20.35%

ROCE (%) 26.81% 23.19% 21.69% 20.20%

EV/EBITDA (x) 9.93 9.09 8.10 7.31

Debt-Equity Ratio 0.84 0.62 0.50 0.42

Book Value (Rs.) 106.68 151.44 197.24 247.65

P/BV 5.91 4.16 3.19 2.54

Charts:

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15

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Outlook and Conclusion

At the current market price of Rs.630.00, the stock is trading at 13.78 x FY12E and 12.50 x FY13E respectively.

Price to Book Value of the stock is expected to be at 3.19 x and 2.54 x respectively for FY12E and FY13E.

Earning per share (EPS) of the company for the earnings for FY12E and FY13E is seen at Rs.45.73 and Rs.50.41 respectively.

Company’s annual turnover of over US $2.9 billion.

The Company has acquired Shadeed Iron & Steel Co. LLC (SISCO), Oman, in June, 2010. SISCO is setting up a 1.5 MTPA gas based DRI plant in Oman.

JSPL has consistently tapped new opportunities by increasing production capacity, diversifying investments, and leveraging its core capabilities to venture into new businesses.

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Orissa steel plant Expansion with an investment of over US $ 8.00 billion (Rs. 40,000 crore). The first phase of 3 million tonne is expected to be commissioned by 2011.

Net Sales and PAT of the company are expected to grow at a CAGR of 15% and 9% over 2010 to 2013E respectively.

On the basis of EV/EBITDA, the stock trades at 8.10 x for FY12E and 7.31 x for FY13E.

We expect that the company will keep its growth story in the coming quarters also. We recommend ‘BUY’ in this particular scrip with a target price of Rs.718.00 for Medium to Long term investment.

Industry Overview

Sector Structure/ Market Size

Steel industry has a major role to play in the economic growth of India. With new

global acquisitions by Indian steel giants, setting up of new state-of-the-art steel mills,

modernisation of existing plants, improving energy efficiency and backward integration

into global raw material sources, India is now on the centre of the global steel map.

Consumption of steel in the construction sector, industrial applications, and transport

sector has been on the rise and special steel usage in engineering industries such as

power generation, petrochemicals and fertiliser industry is also growing.

India has retained its position as the 5th largest producer in 2010 and recorded a

growth of 11.3 per cent as compared to 2009. India has also emerged as the largest

sponge iron/direct reduced iron (DRI) producing country in the world in 2010, a rank

it has held on since 2002. Sponge iron production grew at a CAGR of 11 per cent to

reach a level of 20.74 million tonne (MT) in 2009-10 as compared to 14.83 MT in

2005-06. India is expected to become the second largest producer of steel in the world

by 2015-16, on account of growing steel demand, rich resources base of iron ore,

skilled manpower and vast experience of steel making and the huge capacity

expansion planned and being executed in the steel sector.

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With the expanding consumer market, Indian steel industry is likely to receive huge

domestic and foreign investments. Nearly 222 memorandums of understandings

(MoUs) for planned capacity of around 276 MT have been signed between the investors

and various State Governments, mostly in Orissa, Jharkhand, Chhattisgarh and West

Bengal.

India has recorded a growth of over 8.6 per cent, producing 6.35 MT of steel in March

2011 as against 5.85 MT in the corresponding month in 2010, according to World

Steel Association (WSA).

Steel exports has increased by 17.3 per cent as it reached an estimated 2.46 MT, while

steel imports were at an estimated 5.36 MT, a growth of 2.8 per cent in 2010.

Production

Crude steel production was registered at 51.57 MT during April-Dec 2010 in the

country as per Joint Plant Committee (JPC). The production is expected to be nearly

110 MT by 2012-13.

Crude steel production grew at a compound annual growth rate (CAGR) of 8.4 per cent

during the five years, 2005-06 to 2009-10. The crude steel performance accounted for

31 per cent of the total crude steel production in the country during 2009-10,

contributed largely by the strong trends in growth of the electric route of steel making,

particularly the induction furnace route, which was a key driver in the growth of the

segment. In case of total finished steel (alloy + non-alloy), production for sale was

recorded at 47.30 MT, a growth of 7.9 per cent during Apr-Dec 2010.

Steel Authority of India (SAIL) Ltd has planned to enhance its hot metal production

capacity from the level of 13.82 million tonnes per annum (MTPA) to 23.46 MTPA

under its current phase of expansion and modernisation which is expected to be

completed by financial year 2012-13. In the next phase, SAIL would increase its

capacity further to 26.18 MTPA.The indicative investment for current phase is about

US$ 13.28 billion. Additionally, approximately US$ 2.21 billion has been earmarked

for modernisation and expansion of SAIL Mines.

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NMDC Ltd plans to increase the production of iron ore from the present level of about

24 MT to 40 MT by 2014-15. Besides, setting up a 3 MTPA Integrated Steel Plant at

Nagarnar in Chhattisgarh. The environmental clearance for the plant has been

accorded by Ministry of Environment and Forests (MoEF).

Consumption

The Indian steel industry has been on a high-growth trajectory led by buoyancy in

sectors such as infrastructure and construction, oil and gas and automobiles. The

demand for steel is expected to further increase with major international automobile

manufacturers setting manufacturing facilities in India.

The consumption of steel domestically was recorded at 44.28 MT, indicating further

strengthening of demand during Apr-Dec 2010. The consumption of steel in the

country has shown an increase of 10.3 per cent during April 2010 to January 2011 as

compared to the same period of previous year.

Major Developments

The Indian steel market has witnessed the announcements of mega expansion plans

from leading domestic producers in the form of greenfield and/or brownfield projects.

Furthermore, with an expanding consumer market, the steel industry in India is likely

to receive huge domestic and foreign investments.

Posco, South Korea, plans to set up a 12 MT integrated steel plant in Orissa.

Mittal Group's announced plans to set up their 12 MT integrated steel unit in

Orissa.

Tata Steel Ltd (TSL) has taken over US$ 12 billion Anglo-Dutch giant Corus

Group Plc, transforming the former into a significant global steel producer,

which may well be regarded as a benchmark even in the history of the Indian

steel industry.

Bhilai Steel Plant (BSP), the flagship entity of the Steel Authority of India

Limited (SAIL), has secured a fresh order of exporting rails to Sri Lanka. The

order of about 14,000 tonnes is for the UIC-60 grade of rails. Earlier, the

company had received an order to supply 6,500 tonnes of rails to Sri Lanka.

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The Essar Group, through Essar Africa Holdings Ltd (EAHL), has bought 54 per

cent stake in Zimbabwe’s state-owned steelmaker, Zisco. The total deal is

valued at US$ 750 million.

The State Level Single Window Clearance Authority (SLSWCA) in Orissa has

cleared four investment proposals in the steel sector worth US$ 632.86 million.

Orissa through its nodal agency for land acquisition, Industrial Infrastructure

Development Corporation of Orissa Ltd (Idco), has allotted 20684.06 acres of

land to steel companies that have signed memorandum of understanding (MoU)

with the State. The steel sector in Orissa has already recorded an investment of

US$ 11.64 billion till the end of December 2010.

Tata Steel Ltd (TSL) and Nippon Steel Corporation (NSC) have signed a joint

venture (JV) agreement to setup India's first continuous annealing and

processing line (CAPL) for the production of 600,000 tonnes per annum of

automotive cold-rolled steel at Jamshedpur, India. TSL will hold 51 per cent

and NSC will hold 49 per cent of equity capital of the JV Company. The project

will be set up at a capital cost of approximately US$ 509.08 million and is

expected to come on stream in 2013.

NMDC Ltd has signed a pact with Russian steel and mining major Severstal to

set up a 5 MTPA steel plant in Karnataka as part of a strategy that aims to

boost the company's revenue by increasing presence in value added product

chain. It has also set up a 3 MTPA integrated steel plant at Nagarnar,

Chhattisgarh, which is likely to be commissioned in 2014.

It has also set up a 3 MTPA integrated steel plant at Nagarnar, Chhattisgarh,

which is likely to be commissioned in 2014.

Essar Steel has commissioned a state-of-the-art Compact Strip Production

(CSP) mill with a capacity of 3.5 MTPA. The CSP mill is a part of the company's

expansion plans of raising the steel production capacity at Hazira at a cost of

US$ 3.03 billion. The company has also commissioned two iron making units–a

blast furnace with a capacity of 1.73 MTPA and a DRI unit of 1.74 MTPA, a

conarc furnace of 2.5 MTPA, besides commissioning India’s first 5-metre wide

plate mill with a capacity of 1.5 MTPA and a pipe mill with an annual capacity

of 0.6 MTPA.

21

Sesa Goa, a Vedanta Group company, has acquired the assets of Bellary Steel

and Alloys (BSAL) for US$ 48.94 million in a competitive bidding process

conducted by Industrial Financial Corporation of India (IFCI) Ltd.

JSW Steel plans to infuse US$ 83.54 million in Ispat industries in the next 2-3

years. JSW Steel plans to invest US$ 16.86 billion over the next 10 years to

ramp up capacity from 7.8 to 32 MTPA through greenfield and brownfield

projects.

Government Initiatives

The current policy regime allows 100 per cent foreign domestic investment (FDI) in

steel sector, as per Mr Beni Prasad Verma, Minister of State for Steel (Independent

Charge). Some multinational steel companies like POSCO and Arcelor Mittal have

signed MoU with respective to State Governments to set up steel production units in

the country. The total proposed capacity under FDI is approximately 45 MT.

Some of the initiatives undertaken by the Indian Government in the Eleventh Five

Year Plan (2007-12) to promote the steel sector include:

The Planning Commission has approved a total outlay of US$ 9.5 billion for the

development and promotion of the iron and steel sector.

The scheme for the promotion of research and development in the iron and steel

sector has been approved with a budgetary provision of US$ 24.6 million to

initiate and implement the provisions of the scheme.

National Steel Policy 2005 is under review and the process for drafting a

'National Steel Vision' has since been initiated.

Five year strategy paper has been prepared for promotion of Steel sector in the

country.

Moreover, in the Union Budget 2010-11, the Government has allocated US$ 37.4

billion to the infrastructure sector and has increased the allocation for road transport

by 13 per cent to US$ 4.3 billion which will further promote the steel industry.

Ministry of Steel in association with United Nations Development Programme (UNDP)

is carrying out a project on ‘Removal of Barriers to Energy Efficiency Improvement in

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Steel Re-rolling Mill Sector in India’ at an estimated cost of US$ 14.03 million. The

project seeks to reduce greenhouse gas emissions by providing technical assistance to

small and medium sized steel re-rolling mills in the country to enable them to adopt

more energy efficient and environmentally friendly technologies.

______________ ____ _________________________ Disclaimer:

This document prepared by our research analysts does not constitute an offer or solicitation

for the purchase or sale of any financial instrument or as an official confirmation of any

transaction. The information contained herein is from publicly available data or other

sources believed to be reliable but do not represent that it is accurate or complete and it

should not be relied on as such. Firstcall India Equity Advisors Pvt. Ltd. or any of it’s

affiliates shall not be in any way responsible for any loss or damage that may arise to any

person from any inadvertent error in the information contained in this report. This document

is provide for assistance only and is not intended to be and must not alone be taken as the

basis for an investment decision.

23

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