Stronger Through Enhancing Capabilities

Leveraging economies of scale

We registered significant growth in overall sales volume in the year. Our finished steel making capacities increased due to the commencement of commercial production from CAL2, BRM2 and ACL (for electrical steel) facilities at Vijayanagar. During the year, we shut down three upstream steel making locations (Vijayanagar, Dolvi and Salem units) for capacity expansion. Following expansion, our total crude steel capacities touched 18 MTPA.

This phase of organic growth in terms of reconstruction of blast furnaces will result in lower conversion cost; and help us in attaining further competitiveness in domestic as well as global markets.

Building a prudent cost structure

At JSW, we rearranged our cost base by operational efficiencies. This was supported by a decline in raw material costs, primarily because of commodity down cycle. The result was that we remained a globally competitive steel producer.

Our prudent sourcing strategy also led to cost efficiencies. We diversified our raw material sourcing from different geographies and suppliers over the past few years. This approach produced the desired outcome, without compromising production schedules.

Ensuring raw material availability

Commodity prices, be it iron ore or coal, saw huge price swings in recent times. It has been significantly challenging to maintain the source and keep costs under control.

Iron ore being the key input for steel making, saw price volatility as never before. International prices for iron ore plunged to a record low during the year, offering us a sustainable opportunity to blend sourcing of iron ore from domestic and imports. More so, this year hedging of commodity price was also put into practice, thereby de-risking the volatility associated with imports.

Another significant cost attached to bulk raw material is logistics. A focused drive was initiated during the year by developing customised solutions, which has already started yielding results; and such benefits will continue for years to come. The development of cape compliant port to handle imported cargoes added to the efficiency and cost competitiveness.

Integration and technological expertise leading to reduced production cost and time

Diverse blend of technology

• Coke making: Recovery and Nonrecovery Coke Ovens
• Agglomeration: Pelletisation and Beneficiation Plants, Sintering Plant
• Iron making: Blast Furnace, Corex, Sponge Iron (DRI)
• Steel making: Basic Oxygen Furnace (BOF), Electric Arc Furnace (EAF), Conarc
• Casting: Continuous Casting, Thin Slab Casting, Billet Casting

High labour productivity

• Improving labour productivity: Current production of ~1,055 tonnes/ employee¹
• In-house training programmes
• Continuously investing, building and enhancing competencies

Integrated operations

• Integrated manufacturing facilities: From beneficiation, pelletisation, sintering to downstream value-add product capabilities
• Dedicated port and railway siding for logistics support
• Assured power supply through captive power plants and arrangements with JSW Energy

Resulting in operational efficiency

Reduced raw
material costs

Focus on process
improvements

Waste gas utilisation for power generation

Efficient operations, resulting in low conversion cost

    Note: ¹Total production (12.56 MT) divided by total no. of employees on Company payroll (11,904) in FY 2015-16.