SAIL launches new initiative

Initiative to address dual challenges of high cost of production and lower sales realization

GN Bureau | September 12, 2013



A special initiative was launched by Steel Authority of India Limited (SAIL) during an apex strategic confluence on cost control and cost competitiveness. The initiative named COIS (Cost Optimization Initiatives of SAIL) outlines the road map for achieving an overall saving target of around Rs 5,000 crores during the next three years.

Under this special initiative, input optimisation, improving the operational efficiency by optimally utilising the available assets among others thrust areas have been identified for continual cost reduction.

Highlighting the challenges before the organisation due to prevailing market conditions and intense competition, C S Verma, CMD, SAIL stressed on the need to think out of the box.

The Indian steel companies are facing the dual challenge of high cost of production and lower sales realization. The cost of production is being driven up by the volatility in the prices of coal, higher railway freight, power tariff, royalty on minerals and depreciation of the rupee. The prices are flat due to prevailing market conditions leading to severe pressure on margins.


 

 

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