Mumbai, July 2: Tata Iron and Steel Company (Tisco) does not want to remain a mere producer of steel. The company now seeks to become a solutions provider whereby steel products will be designed especially for key buyers.
Chairman Ratan Tata said this was necessary due to the dynamics of the industry.
“Our biggest challenge at this point is to manage the inevitable volatility of industrial cycles and continuously improve the product mix and to build long term relationships with major customers in India and abroad,” Tata said.
To achieve this, Tisco would need a transition from merely being a steel supplier and become a ‘solution provider’ working together with key customers to ‘design and deliver’ steel products which improve the customers’ product cost, he added.
Tisco, Tata said, also plans to double its export of iron ore this year as it sees a huge business opportunity in the international market for this commodity.
The Tisco chief further revealed that capacity at the Jamshedpur unit will be hiked by a million tonnes as demand for steel is expected to continue to grow over the medium term.
However, Tata cautioned the management and staff of Tisco, saying that they must guard against any creeping sense of complacency. “Instead, the team at Tata Steel will need to utilise this time of achievement to establish new levels of performance and greater leadership,” he said.
The company has also decided on a capital expenditure programme to provide balancing facilities. Apart from hiking the capacity of crude steel, downstream finishing mill capacities would also be increased to make more value-added products. The project is slated for completion by March 2006.
At the finance front, Tisco is planning to bring down its level of debt further by prepayment of some of the existing loans, a large part being foreign currency loans.