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voda 8 november 2017 21:03

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JSW Steel sees stable input costs, margin – Mr Seshagiri Rao

Image Source: thehindubusinessline.com
BloombergQuint reported that input costs for the steel industry are expected to stabilise in the coming quarters, which will lead to an improvement in prices or realisations and profit margin in the second half of the current financial year, Mr Seshagiri Rao, joint managing director and chief financial officer at JSW Steel Ltd., told BloombergQuint that the demand picture for steel looks robust at the moment.

Mr Rao said that in the second quarter, realisation was flat because the surge in the international prices of steel could not be passed on in India at the same pace since imports went up substantially. Here are edited excerpts of the interview:

Mr Rao said that therefore, if imports are moderated as requested and input prices and margins stabilise, JSW Steel will perform better in the second half than the first half of the current financial year.

Q - The second quarter was impacted by higher input costs and higher imports. Can you tell us what the picture for next two quarters will look like?

A - The global steel industry’s outlook has been very positive, particularly taking into account the developments in China and also in the advanced economies. In the first nine months of calendar year 2017 steel demand is expected to be 7 percent higher and in China, it will be up 12.4 percent. So, there is a positive sentiment for the global steel industry outlook. That’s why we are seeing some stabilisation in prices and also an upward bias in the overall steel prices.

The investment sentiment is improving. Globally, infrastructure investment is coming up again because of higher commodity prices. Taking that into account, with regards to India, as far as steel demand is concerned, we have grown by 4 percent which is higher than last year. The second half of the financial year is generally better than the first half. So, steel prices should be better than first half in the second half and demand should pick up too. Taking all these factors into account, JSW Steel is likely to do well in the second half.

Q - Input prices have increased and imports have increased as well. Do you think pricing might improve in the second half?

A - Commodity prices rose across the globe. Iron ore which was at USD 40 per tonne went up to USD 80, even though some correction has happened helping it stabilise at USD 60. So, the extra iron ore cost is getting absorbed. Coking coal prices which were below USD 100 went above USD 200, then came down to USD 180, and stabilised at those levels. So, in the second quarter of this financial year, we had to absorb the higher raw material prices.

At the same time, there was a surge in the international prices of steel. But the same pace increase in steel prices could not be passed on in India because of a substantial increase in steel product imports. Sequentially, it went up by 58 percent.

That is why, the realisation was flat on a quarter-on-quarter basis, and we have seen some pressure in the last quarter. Going forward, I am not seeing an increase in input prices. Steel price margins are stable. Because the demand is robust, I expect the margins to improve in the second half over the first half.

Q - Do you expect the prices of iron ore and coking coal to flatten? Do you expect the import pressure to continue in the next few quarters?

A - As far as raw material prices are concerned, I don’t expect them to further rise over the current prices. Because of two reasons. One is, China has already peaked in steel production. Therefore, there is more supply of iron ore coming in the market and at the same time, coking coal is also coming in market. So, I don’t see an increase in iron ore and coking coal prices at the current levels.

At the same time, we have been bringing it to the attention of the government, that in the last quarter there was a significant increase in the imports of steel production into India. So, it has to be looked at why the imports are coming when the domestic prices are at a lower level than the landed cost of imports for some of the products. We expect some moderation for imports. Some of the imports, which came in the second quarter, were booked when the prices of steel international were lower. So, in my view, the imports in India should moderate going forward.

Hence, I expect the second half, in terms of margin, demand, moderation of imports, to be better than the first half.

Q - By how much do you expect the realisation to improve in the coming quarters?

A - As far as JSW Steel is concerned, there are two-three factors which have to be taken in to account for why the second half will be better for JSW Steel.

Some of the quarterly or half yearly contracts which were there in the first half, they will get repriced in the second half. That’s why the realisation would be reset for those contracts, particularly the original equipment manufacturer customers in the auto and appliances sector.

Second, the exports that we have booked on the old prices, they get repriced in the second half.

The third is, as far as domestic prices are concerned, the discount of imports at international prices and an increase in the scope of domestic prices also takes place.

Taking these three factors into account, I expect the realisation to go up. It is very difficult to say how much it could go up. But generally, I can talk about margin improvement in the second half over the first half.

Q - Would this be restricted to JSW individually or do you think that the realisation could improve for the industry?

A - For the industry, whatever results that have come for the Indian steel companies, more or less they are on the same trend. So, the realisation is flat for some of the steel companies which have announced results. I expect the same trend will continue. One factor is important that our exports are 26 percent of our sales. Therefore, that has to be factored in while looking at other steel companies with regard to repricing of their exports realisation in the second half.

Q - You mentioned that input cost pressure will be stable in the third quarter. What about the quarters ahead?

A - Cyclical volatility is inherent in the steel sector. So companies have to absorb the cyclical nature to be sustainable in their profitability and in the future of outlook. As far as JSW Steel is concerned, 60 percent of our product mix is our value-added products and special products. Therefore, we are reducing the cyclicality and thereby, maintain our profitability.

We would like to increase that proportion. Thereby, the commodity grade steel proportion is reduced in our overall product mix. That is how we are working out. That’s why, we are spending large amount of capex in increasing our downstream products like cold rolling, galvanizing, galvalume and colour coated. These are the products on which we are focusing more. So, it not only has lesser cyclicality but it is also possible to export the product at attractive realisation.

Q - How would the next six odd months look like, in terms of capacity expansion and the mining scenario?

voda 8 november 2017 21:05

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Deel 2:

A - Mining is looking up which is a positive scenario. If we look at either coal or iron ore, the mining activity is improving. As regards to Karnataka, where our major plant is located, there is a cap of 30 million tonne per annum on production. We are expecting a judgement from the honorable Supreme Court that the cap may be relaxed. If that is relaxed, then more iron ore will be available which could give a lot of benefits to JSW Steel and other steel companies which are dependent on Karnataka iron ore mining, This will not only reduce the cost of iron ore but the availability will enable many companies to increase their production and expand their capacities. So, this is how we are looking at it.

More and more mines are coming up for auction in the next few years, which will enable more and more capacity for the steel industry to come in to meet the increasing demand. One important aspect is that today the installed capacity of the steel industry in India is 130 million tonnes. Last year, we produced 97 million tonnes and in this year, it is expected to be 104 million tonnes. So, 130 minus 104, the balance left is only 26 million tonnes.

Generally, the industry works at 80-90 percent capacity utilisation. So, there is no effective capacity to meet our growing demand unless investments happen in the sector to meet the 5-7 percent growth in demand. We are very positive about growth in demand and more investment in the segment to create more capacities.

Q - Speaking of capacities where are you in the process of being able to participate in the insolvency processes that several distressed steel assets are undergoing?

A - Inorganic growth is part of our growth strategy. So, when we became 18 million tonnes from 1.6 million tonne over a period of 15 years, we acquired stressed companies which we turned around. We have a track record in turning around these stressed companies. In a similar breath, we are evaluating various opportunities that are available in India.

When you talk about Insolvency and Bankruptcy Code, it is a very good framework which is lead by the Government of India, Reserve Bank of India and the banks. Under that framework, hopefully, some solutions will come in. We are evaluating opportunities that are there today. So, we will look at it.

In IBC, if a new investor wants to come in - either JSW Steel or someone else, the alignment of various acts in order to ensure that it is attractive for the investor is essential. Either you look at Income Tax Act, 1961 or Securities and Exchange Board of India guidelines or Companies Act, 2013 or the Stamp Act in India, there is inconsistency relative to the pre-IBC and post-IBC scenario.

In pre-IBC times, when Sick Industrial Companies (Special Provisions) Act, (SICA) or Board for Industrial and Financial Reconstruction (BIFR) or any other processes were there all the acts provided exemptions for any such schemes. But when IBC came in, appropriate amendments were not done. That is one limitation I believe.

Any restructuring or resolution plan will involve capital reduction, capital change, variation of shareholders rights, de-listing, merger, demerger or slum sale, so many things can happen as part of restructuring. In SEBI’s Section 3 (II) guidelines of the de-listing regulations, it provides exemption for a scheme under BIFR and SICA but not under IBC or NCLT. It is very essential that the amendment is done. Otherwise, there is a problem with regards to any scheme that will come in which is not consistent with the SEBI regulations.

Same problem with the income tax act, look at Section 50, 56, 72, 79, 150-JB. There are various sections which have provisions relating to the old act, but in the IBC there are no amendments that have not been done in income tax act. Any scheme that is given involving waiver or write-back of loans or any restructuring of companies or issue of share settlers as per the market price, when these things happen, there is a huge tax liability that will come in under income tax act. Same with the Stamp Act.

In my view, it is essential that somebody looks at these aspects and aligns these acts which will be good for the investors so that it is not an incentive for an existing management to ensure that it (the deal) is not attractive to the new investors to come in. At the same time, the banks would get better proposals, if these are looked at and quick amendments to these acts are made.

Q - Have you had a chance to express your interest in both Bhushan Steel and Monnet Steel asset?

A - Steel industry is a cyclical industry. So, if a cyclical industry has to be sustainable, then it is very essential for capital allocation to be important. We are able to create capacity of 18 million ton with an investment of Rs 60,000 crores i.e Rs 3000-3500 crores per million ton. So, I am hearing a lot of noise in the market that companies will bid aggressively for the steel companies to acquire capacities which, in my view, is not so.

Today, if anybody invests a large sum of money for acquiring a million tonne, then it is not sustainable in long term. So, you need to be aware as the investors know who is an existing or the new player. Then if an acquisition has to be done then it has to be at a sustainable price. It has to give returns to shareholders. From that point of view, the assets have large amount of debt.

voda 8 november 2017 21:06

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Deel 3:

In my view, it involves significant haircuts by the banks in order to ensure that these assets are nursed back to normalcy and the acquirer is be able to give a good resolution plan. It is essential that the haircuts be significant in these cases.

Q - What will be the capacity expansion plan over the next 2-5 years for JSW Steel? How much that will be organic and inorganic and what kind of additional capital are you going to put to work to support these plans?

A - We have announced a capex plan of Rs 26,800 crore for a period of three years, including the current financial year. On completion of Rs 26,800 crore capex which is organic growth, it will take us from current 18 million tonnes to 23 million tonnes. Similarly, our downstream capacities will go up to the extent of 45 percent of total capacity. As a part of this capex, a lot of cost saving initiatives or expenditure we’re incurring like pipeline conveyors, water reservoirs... So, all this will take us to 23 million tons. We are creating very efficient capacity as part of this organic growth.

In addition to inorganic growth, we have environmental clearance at Vijayanagar to expand our plan to 16 million ton from 12 million ton. So, another 4-million-ton brown field expansion is possible, subject to improvement in the availability of iron ore in Karnataka. This is how we are looking at the organic growth story. In addition to new green field projects, either in Odisha or Jharkhand. There we are working to acquire iron ore mines in the auction and also on acquiring the land. That is a medium term plan to set up greenfield projects as part of our organic growth story.

Q - How much powder you are keeping dry for the inorganic strategy? I am sure you interested in Bhushan Steel and Monnet Steel, how much money are you willing to put to it?

A - We have a strong balance sheet. Last year, we had a net profit of Rs 3,500 crores and we have EBITDA of Rs 12,200 crores. Our first half results are quite strong. Taking in to account our financial numbers, we have adequate cash generation within the company to plan our organic and inorganic growth. That is how we are planning to do it.

Two important financial policies are important for us. In that we said that we will have debt-equity ratio of 1.75:1 and debt to EBITDA is 3.75:1. So, within this two ratios we will craft our organic and inorganic growth story and accordingly we will raise the resources for it.

Source : BloombergQuint

voda 8 november 2017 21:16

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Scientists want WA iron ore mine at Helena Aurora Range banned

Perth Now reported that fifty scientists and academics have signed a letter urging the West Australian government to block an iron ore mine expansion that would affect the Helena Aurora Range. According to the letter, the range and its distinct red rocks that were formed billions of years ago is a refuge for threatened flora and fauna, including two declared rare native flowering plants found nowhere else on earth.

The fact the Environmental Protection Authority had rejected miner Mineral Resources' proposal in June should send a clear message that the range's "natural and cultural values ... should be preserved in perpetuity and for all to enjoy.”

Environment Minister Stephen Dawson received a report last Friday by WA's Appeals Convenor, who considers appeals to EPA decisions.

The 50 scientists and academics called on Premier Mark McGowan and Mr Dawson to adopt EPA duty chair Robert Harvey's recommendation to protect it and the letter calls for the area to be made a "class A" national park.

The Helena and Aurora Range Science Declaration was released on Monday by Emeritus Professor John Bailey, a past member of the EPA and chair of the Conservation Commission of WA.

He said the Helena Aurora Range was the most significant intact banded ironstone formation range left in the Yilgarn region, 500km northeast of Perth.

The letter said that "These ranges are remnants of a landscape dating back over 2.6 billion years, meaning that they are among the most ancient landforms on Earth.”

Former premier Carmen Lawrence says the area is an incredible landscape. She said that "I think as a community we're only just starting to really appreciate how unique and rare places like this are.”

Yilgarn Iron Ore Producers Association chief David Utting rejected claims the range was unique. He told ABC radio that "It is not a unique area. There are also not endangered species of animals and plants there that stand to be wiped out.”

The previous WA Liberal National government intervened in support of Mineral Resources and ordered a review after the EPA rejected the project in 2014.

Source : Perth Now

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voda 8 november 2017 21:18

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Baffinland Iron Mines takes icebreaking off the table

Nunatsiaq Online reported that Baffinland Iron Mines, which operates the Mary River mine in North Baffin, has scrapped its plans for winter icebreaking in Eclipse Sound. The mining company had been seeking an amendment to the North Baffin Regional Land Use Plan to permit limited icebreaking so they could bring in a maximum of two winter sea lifts of freight from December to February.

Mr Todd Burlingame, vice-president sustainable development for Baffinland, in a letter to the Nunavut Planning Commission said that “Baffinland has reviewed the comments submitted by the parties and has considered the concerns expressed by the community of Pond Inlet.”

He added that “Baffinland has reconsidered the need for seeking an amendment to the [land use plan] to allow for annual winter sea lifts and is formally withdrawing the proposed winter sea lift from the proposed amendment application.”

That’s good news, says Joe Enook, recently re-elected MLA for Tununiq, the constituency that includes his hometown of Pond Inlet. He said that “A lot of people don’t realize that Baffinland has really, in my opinion, tried to accommodate the community of Pond Inlet by changing their focus over the years.”

Baffinland, currently operating under its early revenue phase at the Mary River mine, first approached the Nunavut Impact Review Board three years ago with changes to phase two of its operational plan. That would have included winter icebreaking and ore shipping, and transforming its tote road, which runs from the mine site to the port, into a railway line.

In September, the NIRB determined that constituted significant changes and bounced it back to the Nunavut Planning Commission to see whether the request conforms to North Baffin’s land use plan.

For more than a year, Baffinland has been scaling back its winter shipping request in response to widespread opposition from Pond Inlet residents, who said icebreaking would jeopardize their ability to travel and hunt on the sea ice of Eclipse Sound.

Mr Enook said that “Eclipse Sound is our grocery store, and there was a potential for disruption.”

The company’s final request to the planning commission was for a maximum of two winter sea lifts of freight. But, as Burlingame’s recent letter confirms, the company is abandoning all requests for icebreaking and is now concentrating solely on the railway amendment.

Mr Enook said that “While some people will state that Baffinland really can’t make up their minds because they keep switching at the spur of the moment, well, we should be glad that they’re switching their focus again because they’re trying to accommodate Pond Inlet to the best of their ability.”

He added that “I give them credit for that.”

According to Baffinland’s proposal, submitted to the planning comission in March, the company wants to amend an appendix of Baffin’s land use plan to allow a railway within an an existing, and permitted, road corridor.

Their proposal also includes a possible future “south railway” that deviates from the current corridor in one section. But, for now, the company is satisfied with putting a railway where the tote road currently exists.

Source : Nunatsiaq Online

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voda 8 november 2017 21:45

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Beursblik: winst Aperam valt tegen

Credit Suisse verwacht koersdaling.

(ABM FN-Dow Jones) Rekening houdend met eenmalige posten valt de winst van Aperam in het derde kwartaal tegen. Dit stelden analisten van Credit Suisse woensdag volgend op de cijfers die nabeurs bekend werden gemaakt.

De staalfabrikant rapporteerde een EBITDA van 125 miljoen dollar. Maar hierin zit een verzekeringswinst van 20 miljoen dollar, vanwege een onderbreking bij de Chatelet fabriek, en een eenmalige belastinglast van 10 miljoen dollar. Het 'schone' EBITDA resultaat komt daarmee uit op 115 miljoen dollar, volgens Credit Suisse, terwijl de analisten op 125 miljoen dollar rekenden en de consensus lag op 127 miljoen dollar.

Ten opzichte van het tweede kwartaal betekent dit een daling van 32 procent en op jaarbasis een daling van 7 procent. De analisten van Credit Suisse denken dan ook dat de koers zal gaan dalen, maar veel hangt af van het management van Aperam in een analistencall zal gaan zeggen over de risico's in het vierde kwartaal.

De marktvorsers merken echter op dat ze Aperam als een bedrijf met een hoge kwaliteit beschouwen, met een gezonde balans.

Het aandeel Aperam sloot woensdag 0,8 procent hoger op 46,47 euro.

Door: ABM Financial News.

info@abmfn.nl

Redactie: +31(0)20 26 28 999

Copyright ABM Financial News. All rights reserved

(END) Dow Jones Newswires

voda 9 november 2017 16:19

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Beursblik: focus op outlook bij resultaten ArcelorMittal

Analisten rekenen op stabiele winstontwikkeling in derde kwartaal.

(ABM FN-Dow Jones) De aandacht bij de kwartaalresultaten van ArcelorMittal zal onder andere uitgaan naar de verwachtingen voor het vierde kwartaal, die waarschijnlijk positief zullen zijn. Dit stelden analisten voorafgaand aan de resultaten die het staalbedrijf vrijdag voorbeurs presenteert.

Eerder al bleek uit een door het bedrijf zelf opgestelde consensus dat er op een stabiele winst wordt gerekend. Deze consensus gaat uit van een bedrijfsresultaat (EBITDA) van 1.869 miljoen dollar. In het derde kwartaal van 2016 was dit 1.897 miljoen dollar en in het tweede kwartaal 2.112 miljoen dollar.

Analisten van Goldman Sachs schreven in hun preview dat ze erop rekenen dat het staalbedrijf zich positief zal uitlaten over het vierde kwartaal. "Alhoewel het derde kwartaal seizoensgebonden zwak is, zijn er weinig tekenen dat de staalmarges zakken, wat volgens ons zou moeten leiden tot meer optimisme voor het vierde kwartaal".

Goldman Sachs heeft een koopadvies op ArcelorMittal. Het aandeel is zelfs de topfavoriet voor de bank in de Europese staalsector.

Marktvorsers van Deutsche Bank werden recent positiever over het staalconcern en verhoogden hun taxaties voor de jaren tot en met 2019, net als hun koersdoel. "Ondanks de gebruikelijke seizoenseffecten, verwachten we dat ArcelorMittal solide resultaten over het derde kwartaal zal rapporteren, gevolgd door een verdere verbetering op kwartaalbasis in het vierde kwartaal."

De spreads, het verschil tussen de prijzen en de kosten, blijven volgens Deutsche Bank gunstig voor ArcelorMittal, en daarmee is de onderneming goed gepositioneerd om te profiteren van huidige cyclische meewind. Bovendien verwachten de analisten dat de financieringskosten voor het bedrijf verder zullen dalen en dat is goed nieuws voor de kasstromen. Maar vanwege de hoge grondstofprijzen momenteel en ongunstige valutaschommelingen verwachten de marktvorsers niet dat de nettoschuld veel zal zijn gedaald voordat het vierde kwartaal begon.

Ook Deutsche Bank beveelt beleggers aan het aandeel te kopen.

ArcelorMittal kreeg woensdag te horen dat de Europese Commissie een diepgaand onderzoek is begonnen naar aanleiding van de voorgenomen overname van de Italiaanse staalfabriek Ilva door ArcelorMittal. Brussel is bezorgd dat de prijzen omhoog zullen gaan na de acquisitie, vooral in Zuid-Europa. ArcelorMittal liet direct weten te blijven samenwerken met de Commissie en te hopen op een spoedige goedkeuring van de deal.

Het staalconcern maakt vrijdag voorbeurs de bedrijfsresultaten bekend. Op een rood Damrak noteerde het aandeel ArcelorMittal 2,6 procent lager op 24,51 euro.

Door: ABM Financial News.

info@abmfn.nl

Redactie: +31(0)20 26 28 999

Copyright ABM Financial News. All rights reserved

(END) Dow Jones Newswires

voda 9 november 2017 16:27

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Beursblik: kasstroom meevaller bij Aperam

Resultaten volgens UBS grofweg in lijn.

(ABM FN-Dow Jones) De kwartaalresultaten van Aperam waren grofweg in lijn met de verwachtingen. Dit stelden analisten van UBS donderdag.

De sterke kasstroom van 50 miljoen dollar zorgde ervoor dat de nettowinst daalde tot 116 miljoen dollar. "Aperam is op weg om schuldenvrij te zijn", voegde UBS daaraan toe, die voor afgelopen kwartaal op een licht negatieve kasstroom had gerekend.

De EBITDA lag met 125 miljoen dollar nipt onder de 126 miljoen dollar die analisten hadden voorzien. Daarbij wees UBS er wel op dat Aperam een last van 10 miljoen dollar nam.

Voor het vierde kwartaal verwacht Aperam dat de EBITDA zal toenemen ten opzichte van het afgelopen kwartaal, terwijl de nettoschuld zal dalen.Aangezien analisten gemiddeld al rekenen op een stijging van de EBITDA met 22 procent, rekent UBS er op dat de consensus slechts minimaal zal worden verhoogd.

UBS heeft een Neutraal advies op Aperam met een koersdoel van 46,50 euro. Donderdag daalde het aandeel 2,0 procent naar 45,52 euro.

Door: ABM Financial News.

info@abmfn.nl

Redactie: +31(0)20 26 28 999

Copyright ABM Financial News. All rights reserved

(END) Dow Jones Newswires

voda 9 november 2017 20:08

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JSW Steel chief talks tough over promoters bidding for own assets

PTI reported that after seeking a ban on trading in the shares of listed companies referred to the National Company Law Tribunal, JSW Steel chairman Mr Sajjan Jindal on Wednesday said dubious promoters should not be allowed to submit a rehabilitation plan under the insolvency law. Mr Jindal said in a tweet "Dubious promoters should not be allowed to submit the rehabilitation plan to prevent misuse of the IBC. Also the bidding criteria should be spelt out explicitly prior to inviting the bids. This will avoid likely litigation.”

Last week, Jindal had said that trading in shares of the listed companies referred to the NCLT should be suspended to avoid market speculations. He had tweeted "Listed company shares in the event of reference to NCLT should be suspended as per global practice to avoid speculation in the market. Suspension of shares helps in cleaner takeovers and doesn't make the deal expensive for the prospective investor.”

The JSW chief's comment comes a day after the Insolvency and Bankruptcy Board of India (IBBI) put in place strict norms for resolution plan approval under the insolvency law, wherein an applicant's antecedents and credit worthiness will be checked. The IBBI announcement of amendments related to the corporate persons resolution process has been made amid a rising number of cases being filed under the insolvency law and concerns in certain quarters on whether the promoter of a company under the insolvency process can submit a resolution plan. IBBI said in an official release on Tuesday "Now prior to the approval of a resolution plan, the resolution applicants, including promoters, will be put to a stringent test with respect to their credit worthiness and credibility.”

It is now clear that even promoters can submit a resolution plan provided they are subject to strict disclosure requirements under the revised norms.

Source : PTI

voda 9 november 2017 20:10

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Essar Steel output falls as IRP cites working capital crunch

The Hindu reported that debt laden Essar Steel, being run by a National Company Law Tribunal-appointed interim resolution professional (IRP), saw second-quarter output drop 15% to 1.33 million tonnes, from 1.57 million tonnes in the preceding three months. In a recent presentation to creditors of Essar Steel, the IRP had indicated that the operations of the steelmaker could slide for want of long-term working capital. As per the IRP, monthly operating profit declined to INR 113 crore in July, from INR 297 crore in April. If long-term funds were not made available, it could fall further.

An Essar Group spokesman wrote in an e-mail that “Essar Group has submitted EoI for Essar Steel. A resolution plan will be submitted to IRP within the scheduled time frame. IBC allows promoters to bid for their company at the NCLT, and there are no limitations. The entire process is on purely commercial basis and the final selection is done based on the highest bid offered for the NCLT company. This practice of promoters being permitted to bid in bankruptcy/insolvency cases is prevalent in the US, the UK and many developed and developing countries.”

Competitors such as ArcelorMittal, Tata Steel, SAIL, Posco, Nippon Steel have reportedly shown interest in buying the Essar Group’s steelmaking facilities, which the group is keen to retain for itself.

Source : The Hindu

voda 9 november 2017 20:10

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Kyoei Steel Company buys 20pct shares of VIS

Viet Nam News reported that Japanese Kyoei Steel Company officially became strategic shareholder of Vi?t Nam-Italy Steel Joint Stock Company (VIS). The Japanese Kyoei Steel Company purchased 20 per cent stake from Thái H?ng Company, VIS’s biggest shareholder. After the VN? 480 billion (USD 21.17 million) transaction, Thái H?ng owns 45% stake in VIS.

According to VIS’s management board, the co-operation between Vi?t Steel, Thái H?ng Company and Kyoei Steel will help the company to further develop in the future. In addition, it expected to receive technological support from Kyoei Steel Group to improve its production and business.

VIS was established in 2001 by Sông ?à Corporation. The corporation later decided to divest all of its 26.1 million shares from VIS.

Thái H?ng is a large distributor for many steel manufacturers such as VIS, Vi?t Nam Steel Corporation, Posco, Pomina and Thái Nguyên Iron and Steel Corporation (TISCO). Currently, the company holds around 3.6 per cent of market share. It plans to develop new plants to reach a capacity of 850,000 tonnes of steel and 1.1 million tonnes of steel billet.

Source : Viet Nam News

voda 9 november 2017 20:11

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Fake Tata Steel products found in Telangana

Business Standard reported that the Hyderabad Police has found angles, beams and channels going by the name TATA ISPAT during a raid conducted on a downstream re-rolling mill in Telangana's Ranga Reddy district, as part of a crackdown on counterfeit products. The police have conducted raids based on a complaint lodged by Tata Steel over the presence of counterfeit products in the market.

An FIR has been filed against the manufacturer for infringing the trademark ion this regard, besides impounding other charges for copyright violation, misrepresentation and cheating, according to Tata Steel.

While TATA ISPAT is not a product of Tata Steel or any other Tata group companies, the same was being allegedly passed on by this manufacturer to consumers in rural areas as a Tata product.

Company said in a statement "This is a concerted drive being undertaken by the steel company to protect its brand. It firmly believes in selling its products through approved distribution channels, as per the law of the land. The company has also conveyed this message to its distributors so that their business is not affected by such illegal practices.”

Source : Business Standard

voda 9 november 2017 20:12

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4 killed and 7 injured in hot metal spill at Radiant Bar unit of Rana Steel in Haridwar

Times of India reported that four of the 11 workers, who suffered burn injuries after 300 kg of molten iron ore fell on them, died on Wednesday. The incident took place at an iron bar factory in Landhaura when the wire of a container carrying molten iron ore snapped on Sunday. The jerk caused some of the molten iron from the container to spill before it hit the floor with a deafening thud. Within seconds, and before anyone could escape, more of the hot liquid splashed on to the workers while the rest of it formed several narrow streams on the floor.

Earlier, the Haridwar district administration had ordered a probe into the incident and on Wednesday police registered an FIR under relevant IPC sections.

Five critically injured were shifted to Delhi’s Safdarjung Hospital on Sunday but later two of them were referred to Dr Ram Manohar Lohia hospital and one to a private nursing home.

Around 125 workers were at Radiant Bar, an iron bar manufacturing unit of Rana Steels, at the time of the accident.

Source : Times of India

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voda 9 november 2017 20:13

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Essar Steel, Bhushan Steel, Monnet Ispat stressed assets set to be resolved first - MD PNB

Financial Express quoted Mr Sunil Mehta, managing director & CEO of Punjab National Bank as saying that the large steel accounts that have been referred to the National Company Law Tribunal under the Insolvency and Bankruptcy Code are the most likely to be resolved first. The state-run bank has an exposure of INR 11,000 crore to 9 of the 12 large accounts that have been referred to the NCLT. Of the 12, the steel accounts include Essar Steel, Bhushan Steel, Electrosteel Steels, Monnet Ispat and Bhushan Power and Steel. Mr Mehta said that “I do not expect that all the 12 accounts will get resolved. I expect out of the nine, at least five-six accounts, especially those in the steel sector will get resolved.” He added that “The steel sector is showing positive signs and they are getting bids.”

Mr Mehta also said that investors who place the highest bids for the stressed assets are likely to be given preference by banks, while reiterating that the existing promoters of those stressed assets are legally entitled to bid for their companies. As a lender, for me money is money. We will definitely give preference to where we are getting a higher value.”

Mr Mehta said that “For example, if I have an exposure of INR 40,000 crore and the bidders are offering INR 10,000 crore, but the promoter brings in a new investor saying they will submit a bid of INR 25,000 crore, we will go with whoever gives the maximum NPV (net present value).”

Mr Mehta said promoters of the stressed asset cannot be denied the right to participate in the resolution process as per the law. He said that “No creditor would like to continue with the same promoter. But participation of the promoter is equally necessary to maintain the asset during the intervening period.” He added that the committees of creditors are in the process of finalising a uniform evaluation criteria for evaluating the bidders.

PNB has made provisions of INR 800 crore for the nine accounts in the first list that have been referred to the NCLT. The bank also has an exposure of INR 6,500 crore to 20 of the 40 accounts in the second list that the Reserve Bank of India (RBI) had sent to banks in August. For the bank, the additional provisioning requirement for these accounts is INR 725 crore.

Mr Mehta said that about a third of these 20 accounts are likely to be resolved outside the NCLT, and the remaining will be sent to the tribunal. The RBI has given banks time till December 13 to work out resolution plans for the accounts mentioned in the second list. Failing to resolve the accounts within the deadline will result in them being referred to the bankruptcy court.

Source : Financial Express

voda 9 november 2017 20:14

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GBP 30 million investments in Port Talbot announced by Tata Steel

Tata Steel has announced investments of around GBP 30 million to help secure the future of steelmaking in South Wales, UK. The announcement is part of a series of planned investments Tata Steel is making in its UK business to strengthen reliability and allow the development and production of high-performing steels demanded by customers. This will help meet the emerging need for next-generation steels for hybrid and electric cars, as well as for energy-efficient homes and buildings and innovative food packaging.

Earlier this year Tata Steel unveiled the UK’s most advanced robotic steel welding line which supplies material for car makers from its site in Wednesfield, UK.

Now a Basic Oxygen Steelmaking (BOS) vessel – weighing 500 tonnes – is to be replaced at Tata Steel’s Port Talbot site. At the same time, the company is replacing the massive cranes in the steelplant, and installing enhanced dust extraction hoods and energy-efficient drives to minimise emissions.

Tata Steel UK CEO, Bimlendra Jha, said: “These investments will help us to increase our reliability and demonstrate our commitment to the longer-term future of steelmaking in the UK. We are also investing in our capability to produce new higher-strength steels in the UK and I was delighted to welcome almost 100 new apprentices and graduates into our business recently, with their training supported by government. The UK steel industry is still facing challenges, including on energy costs and business rates, so it’s vital we continue to work with government to find ways of levelling the competitive playing field with our European competitors.”

The 11-metre high BOS vessel is a steel cauldron used to convert iron into steel before it is further processed and delivered to customers making products like cars, innovative packaging and energy-efficient buildings.

Port Talbot produces high-quality steel which is further processed at Tata Steel’s steel mills around the UK for manufacturers in Britain, mainland Europe and other countries around the world.

Once installed, the new steelmaking vessel will be able to convert 330 tonnes of iron into steel in each cycle. This is done by pumping oxygen through liquid iron at twice the speed of sound, removing unwanted carbon and allowing Tata Steel’s highly-skilled employees to produce the critical grades of steel required by customers.

Explaining why the new steelmaking vessel was needed, Dave Murray, Project Manager, said: “We have two steelmaking vessels and they run 24/7 at temperatures of up to 1,700C, apart from short planned maintenance periods. Despite this they last for around 20 years each and replacing them is an important part of ensuring reliable operations.”

Source : Strategic Research Institute

Bijlage:

voda 9 november 2017 20:15

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Tata Steel taps Adani’s Hazira port for Essar Steel bid - Report

Live Mint quoted two people with direct knowledge of the matter as saying that Tata Steel Ltd, a contender for Essar Steel Ltd’s assets, has secured an informal commitment from the Adani group for use of its port in Hazira, Gujarat, if the Tata group company wins the bid for the bankrupt steel maker’s assets located in the vicinity.

Tata Steel’s move is part of a contingency plan it has drawn should the current port and power infrastructure being used by Essar Steel be unavailable to the new owner of the company, the people cited above said on condition of anonymity.

One of the two people said that “Essar Steel currently uses the facilities of Essar Ports and Essar Power Ltd for raw materials and power supply. There is concern among a section of the potential bidders whether Essar group will continue to provide port and power facilities on the same terms if the current promoters, the Ruia family, loses control of Essar Steel which is currently under bankruptcy proceedings”.

The second person cited above said that the Adani group has given its informal consent to Tata Steel for constructing an additional port terminal exclusively for Essar Steel if there is a change of control in the company and the current facilities are no longer available.

At a distance of approximately 6km from the Essar Steel plant, Adani Hazira Port Pvt Ltd is located on the western side of the Hazira peninsula and handles all types of cargo including bulk, break-bulk, bulk liquid chemicals, petroleum products and edible oil, containers, automotives and crude.

Responding to a query, a spokesperson for Satish Kumar Gupta, the interim resolution professional from Alvarez and Marsal (A&M) appointed for Essar Steel, said: “As a policy, A&M does not comment on client or potential client engagements.”

Source : Live Mint

Bijlage:

voda 9 november 2017 20:15

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Tata Steel taps Adani’s Hazira port for Essar Steel bid - Report

Live Mint quoted two people with direct knowledge of the matter as saying that Tata Steel Ltd, a contender for Essar Steel Ltd’s assets, has secured an informal commitment from the Adani group for use of its port in Hazira, Gujarat, if the Tata group company wins the bid for the bankrupt steel maker’s assets located in the vicinity.

Tata Steel’s move is part of a contingency plan it has drawn should the current port and power infrastructure being used by Essar Steel be unavailable to the new owner of the company, the people cited above said on condition of anonymity.

One of the two people said that “Essar Steel currently uses the facilities of Essar Ports and Essar Power Ltd for raw materials and power supply. There is concern among a section of the potential bidders whether Essar group will continue to provide port and power facilities on the same terms if the current promoters, the Ruia family, loses control of Essar Steel which is currently under bankruptcy proceedings”.

The second person cited above said that the Adani group has given its informal consent to Tata Steel for constructing an additional port terminal exclusively for Essar Steel if there is a change of control in the company and the current facilities are no longer available.

At a distance of approximately 6km from the Essar Steel plant, Adani Hazira Port Pvt Ltd is located on the western side of the Hazira peninsula and handles all types of cargo including bulk, break-bulk, bulk liquid chemicals, petroleum products and edible oil, containers, automotives and crude.

Responding to a query, a spokesperson for Satish Kumar Gupta, the interim resolution professional from Alvarez and Marsal (A&M) appointed for Essar Steel, said: “As a policy, A&M does not comment on client or potential client engagements.”

Source : Live Mint

Aandeel123 9 november 2017 20:23

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quote:
voda schreef op 9 november 2017 16:19:
Beursblik: focus op outlook bij resultaten ArcelorMittal

Analisten rekenen op stabiele winstontwikkeling in derde kwartaal.

(ABM FN-Dow Jones) De aandacht bij de kwartaalresultaten van ArcelorMittal zal onder andere uitgaan naar de verwachtingen voor het vierde kwartaal, die waarschijnlijk positief zullen zijn. Dit stelden analisten voorafgaand aan de resultaten die het staalbedrijf vrijdag voorbeurs presenteert.

Eerder al bleek uit een door het bedrijf zelf opgestelde consensus dat er op een stabiele winst wordt gerekend. Deze consensus gaat uit van een bedrijfsresultaat (EBITDA) van 1.869 miljoen dollar. In het derde kwartaal van 2016 was dit 1.897 miljoen dollar en in het tweede kwartaal 2.112 miljoen dollar.

Analisten van Goldman Sachs schreven in hun preview dat ze erop rekenen dat het staalbedrijf zich positief zal uitlaten over het vierde kwartaal. "Alhoewel het derde kwartaal seizoensgebonden zwak is, zijn er weinig tekenen dat de staalmarges zakken, wat volgens ons zou moeten leiden tot meer optimisme voor het vierde kwartaal".

Goldman Sachs heeft een koopadvies op ArcelorMittal. Het aandeel is zelfs de topfavoriet voor de bank in de Europese staalsector.

Marktvorsers van Deutsche Bank werden recent positiever over het staalconcern en verhoogden hun taxaties voor de jaren tot en met 2019, net als hun koersdoel. "Ondanks de gebruikelijke seizoenseffecten, verwachten we dat ArcelorMittal solide resultaten over het derde kwartaal zal rapporteren, gevolgd door een verdere verbetering op kwartaalbasis in het vierde kwartaal."

De spreads, het verschil tussen de prijzen en de kosten, blijven volgens Deutsche Bank gunstig voor ArcelorMittal, en daarmee is de onderneming goed gepositioneerd om te profiteren van huidige cyclische meewind. Bovendien verwachten de analisten dat de financieringskosten voor het bedrijf verder zullen dalen en dat is goed nieuws voor de kasstromen. Maar vanwege de hoge grondstofprijzen momenteel en ongunstige valutaschommelingen verwachten de marktvorsers niet dat de nettoschuld veel zal zijn gedaald voordat het vierde kwartaal begon.

Ook Deutsche Bank beveelt beleggers aan het aandeel te kopen.

ArcelorMittal kreeg woensdag te horen dat de Europese Commissie een diepgaand onderzoek is begonnen naar aanleiding van de voorgenomen overname van de Italiaanse staalfabriek Ilva door ArcelorMittal. Brussel is bezorgd dat de prijzen omhoog zullen gaan na de acquisitie, vooral in Zuid-Europa. ArcelorMittal liet direct weten te blijven samenwerken met de Commissie en te hopen op een spoedige goedkeuring van de deal.

Het staalconcern maakt vrijdag voorbeurs de bedrijfsresultaten bekend. Op een rood Damrak noteerde het aandeel ArcelorMittal 2,6 procent lager op 24,51 euro.

Door: ABM Financial News.

info@abmfn.nl

Redactie: +31(0)20 26 28 999

Copyright ABM Financial News. All rights reserved

(END) Dow Jones Newswires

We zullen het morgen wel zien

voda 9 november 2017 20:27

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Brazil's biggest environmental disaster still fighting for compensation
Published on Thu, 09 Nov 2017

Thomson Reuters Foundation reported that Farmer Marino D'Angelo Junior resorted to anti depressants after a flood of mud destroyed his village when a dam collapsed at Brazil's Samarco iron ore mine two years ago, releasing millions of tonnes of thick reddish-brown sludge. In total 19 people died after the dam designed to hold back mine waste burst two years ago this month, in Brazil's worst environmental catastrophe, leaving a trail of destruction over more than 600 km (375 miles).

The house D'Angelo Junior called home for 22 years in a rural district of Mariana city, some 70 km from the scene of the disaster in Minas Gerais state, became unsafe because of the mud while his father in law's property was destroyed.

Mr D'Angelo Junior, 48, told the Thomson Reuters Foundation that "It was not only walls and bricks .. My wedding was celebrated there, as well as the baptism of my children. The distance from people, this sudden change in my life has brought me a lot of health problems. I take two anti-depressants a day."

He was out of work for 30 days after the disaster and only received compensation after state prosecutors acted on his behalf.

Prosecutors and victims are concerned that two years after the disaster thousands of victims are still to get compensation although the dam's owners say the process is on schedule.

After the dam gave way, the equivalent of 25,000 Olympic-sized pools of muddy mine waste flowed into the Rio Doce, one of Brazil's main rivers, killing fish and fouling water supplies.

Brazilian prosecutors charged 21 people last year with qualified homicide for their roles in the collapse.

The Samarco mine's joint owners, Brazil's Vale SA and Australia's BHP Billiton Ltd, and Brazilian engineering company VOGBR Recursos Hidricos e Geotecnica, which certified the dam's safety, were charged with environmental crimes.

BHP, Vale and Samarco officials rejected the charges, while VOGBR declined to comment at the time they were brought.

Prosecutors subsequently served the partners in the Samarco mine with a 155 billion Brazilian real (USD 47 billion) claim for the social, environmental and economic costs of cleaning up the disaster with a mid-November deadline to settle.

Prosecutors said that thousands of victims are still waiting for new houses or compensation.

Prosecutors blame an agreement through which the government authorized the mining companies to transfer their environmental, material and compensation obligations to Fundacao Renova, a third-party company created for this task.

Federal prosecutors last May filed a court case questioning the legality of the agreement and arguing the creation of Fundação Renova is illegal as current legislation states the polluter must be directly charged for environmental crimes.

The prosecutors criticized a lack of victims' participation in Fundação Renova's decision-making process as well as difficulties to sue in case obligations were not fulfilled.

Source : Thomson Reuters Foundation

Bijlage:

voda 9 november 2017 20:29

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Why Vale believes the iron ore market is in balance

Vale believes that the iron ore market will stay in balance. During its 3Q17 earnings call, Mr Peter Poppinga, executive director of the Ferrous Minerals and Coal division, noted that these prices are expected to exceed USD 65 per tonne.

Poppinga based this statement on the forward curve for H1 of 2018 on the Dalian Stock Exchange, observing that because people believe that after the restrictions on steel production are canceled, the prices could rise.

Vale’s iron ore price realization for 3Q17 was USD 76.10 per tonne, or ~25% higher than in 2Q17. A rise in the iron ore price benchmark during the quarter, in addition to higher premiums, led to this sequential rise in realizations.

Vale’s iron ore volumes in 3Q17 totaled 76.4 million tonnes, compared with 69.0 million tonnes in 2Q17. The ramp-up of Vale’s S11D mine is helping its volumes.

While Vale’s price realization improved during the quarter, its C1 cash costs fell USD 0.70 per tonne from USD 15.20 per tonne in 2Q17 to USD 14.50 per tonne in 3Q17. Higher fixed cost dilution, lower maintenance, and demurrage costs led to unit cost improvement.

Vale’s Ferrous division accounted for ~87.6% of its adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) in 3Q17, compared with ~82.0% in 2Q17. The division’s EBITDA rose 47.0% YoY (year-over-year) and 65.0% QoQ (quarter-over-quarter). The remarkable improvement in earnings is mainly due to the 13.0% QoQ rise in the iron ore price benchmark. High premiums, higher volumes, and lower costs also helped the company achieve higher EBITDA in 3Q17.

Source : Market Realist

Bijlage:

Vertraagd	6 jun 2024 11:35
Koers	23,250
Verschil	-0,110 (-0,47%)
Hoog	23,420
Laag	23,120
Volume	550.948
Volume gemiddeld	2.672.088
Volume gisteren	4.384.655

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