Scenario of Steel Industry:

Global Steel industry

World crude steel production stood at 1622.8 million tonnes during 2015, a decrease of 2.8% over 2014 based on provisional data released by World Steel Association (WSA). During 2015, Chinese crude steel production reached 804 million tonnes, registering a decline of 2.3% over the previous year. China remained the largest crude steel producer in the world, accounting for 73% of Asian and 50% of world crude steel production during 2015. India was the 3rd largest crude steel producer during 2015 and recorded a growth of 2.6% over 2014.

The global steel industry is going through tough times. Steel demand in 2016 is likely to decline owing to a slower pace of economic growth across geographies. As a result, steelmakers are struggling to sustain margins with excess capacity worldwide and historically low prices. Exports from China continue to penetrate market all over the world, exerting downward pressure on the price of hot rolled band (HRB), which is pushing down prices to levels not seen since 2002 to 2004.

In this scenario, steel companies are likely to reduce debt, manage costs and implement operational improvements to counter the turbulence ahead. However, steel will never lose its relevance; and will remain the cornerstone for industrial and infrastructure growth.

Top 5 Steel producing Countries

Rank Country 2015(Mt) 2014(Mt) % 2014/2015
1 China 803.8 822.8 -2.3
2 Japan 105.2 110.7 -5.0
3 India 89.6 87.3 2.6
4 United States 78.9 88.2 -11
5 Russia (a) 71.1 71.5 0.5

The global economy is mostly positive with growth picking up in the US, India and Southeast Asia, while several emerging markets are experiencing a deceleration in growth. WSA forecasts that global steel demand will decrease by - 0.8% to 1,488 Mt in 2016 following a contraction of -3.0% in 2015. In 2017, it is forecast that world steel demand will return to growth of 0.4% and will reach 1,494 Mt.


India has become the worlds 3rd largest producer of crude steel in 2015 against its 8th position in 2003. The country is also the 3rd largest consumer of finished steel in the world preceded by China and the USA.

India produced 89.6 MT crude steel in FY 2015-16, an increase of 7.7% since last year. In FY 2015-16, the country consumed 109.9 million tonnes (MT) of crude steel. The country witnessed an unprecedented inflow of cheap imports, which saw a significant increase in the last fiscal.

The steel sector in India contributes nearly two per cent of the countrys gross domestic product (GDP) and employs over 6,00,000 people. The per capita consumption of total finished steel in the country rose from 51 kg in 2009-10 to about 59 kg in 2014-15. Indias steel consumption for FY 2015-16 is estimated to increase by 7% higher than 2% growth last year, due to improving economic activity.

Indias GDP grew by 7.6% in FY 2015-16, making it one of the worlds fastest growing major economies. Interestingly, the GDP grew at 7.9% in the fourth quarter, a stellar performance. According to the data released by the Central Statistics Office, the growth in manufacturing and farm sectors during the fourth quarter accelerated to 9.3% and 2.3% respectively. The policy initiatives of the Government, low interest rates, declining fiscal deficit and moderating inflation have helped the Indian economy stay on a sustainable growth path. The growth rate is expected to touch 8% in FY 201617 on the back of a favorable monsoon. The governments Make in India campaign is helping India emerge as a hub for global manufacturing giants.


Gyscoal Alloys Limited is engaged in the business of manufacturing of Stainless Steel and Mild Steel Long Products from scrap since 1999. The plant for the production activities & registered office of the Company is located at Ubkhal, Kukarwada, Vijapur - Taluka, Mehasana- District. The Corporate office of the company is situated at 2nd Floor, Mrudul Tower, Near Times of India, Ashram Road, Ahmedabad.

The Company has the capacity to manufacture all grades of Stainless Steel Products from 200 series to 400 series. The products are primarily used in the construction in chemical plants, Pharmaceutical plants, building construction, railways and other sectors for structural purpose. The Companys products adhere to high quality standards and it has got ISO 9001:2008 certification for "the manufacture and supply of stainless steel and mild steel based angles, channels, flats, round, square, bright, twisted bars, billets and ingots" adhering to IS 2062 & IS 1786" from BSI Management Systems. The Company has also been successful in producing goods according to needs and specifications of its domestic & foreign buyers.

During the financial year 2010-11, the Company entered the Capital Market with Initial Public Offer (IPO) aggregating to approximately Rs 5467 lacs. The details of Utilization of IPO proceeds forms part of Directors Report of the Company.


• During FY 2015-16, the Company recorded a total income of Rs 16390.36 lacs, of which income from the operations was Rs 15932.67 lacs.

• For the year FY 2015-16, Earnings Before Interest, Depreciation, Tax and Amortization (EBIDTA) was (663.94) lacs.

• For the year FY 2015-16, Depreciation was Rs 1057.92 lacs, Interest and Finance charges were Rs 1168.17 lacs and Profit before Tax (PBT) was (1518.37) lacs. And Profit After tax (PAT) was (1325.16) lacs.

• Basic& diluted Earnings per Share (EPS) was (8.37).

• As on March 31, 2016 the Net worth of the Company was Rs 7953.51 lacs.



• Management depth and ability to manage client relationships.

• R & D capabilities to develop efficient and cost effective process at short notice having a State of the Art dedicated R & D Center.

• Multi-purpose and multi-production facilities having Quality Certifications.

• Enhanced presence in the market through clientele basis.


The Company faces stiff competition from medium and larger well-established players. The Company is smaller in size compared to the market leaders. However with capital expenditure in the project of the company it intends to make it good and face competition more confidently.


Your company is mainly focusing on R & D and manpower and the intelligence. Apart from the risk on account of interest rate and regulatory changes, business of the company are exposed to certain operating business risks, which is mitigated by regular monitoring and corrective actions.


The Company believes that human resource is the most important assets of the organization. It is not shown in the corporate balance sheet, but influences appreciably the growth, progress, profits and the shareholders values. During the year your company continued its efforts aimed at improving the HR policies and processes to enhance its performance. The vision and mission of the company is to create culture and value system and behavioral skills to insure achievement of its short and long term objectives.

The Company as at year end has 59 employees on its role and continues to attract talent both from within and outside India to further its business interests. Industrial relations continue to be cordial.


Internal Financial Control that encompass the policies, processes and monitoring systems for assessing and mitigating operational, financial and compliance risks and control over related party transactions, substantially exist. Your Company has appropriate internal control system for business processes, with regards to efficiency of operations, financial reporting, compliance with applicable laws and regulations. In the Company, the Board of Directors is responsible for ensuring the adequacy and effective monitoring of internal financial controls. The Internal Audit Program is designed in consultation with the Statutory Auditors to ensure accuracy and reliability of accounting data and is monitored by the Audit Committee. Audit observations and recommendations are reported to the Audit Committee, which monitors the implementation of the said recommendations. The Companys internal audit team also carries out extensive audits throughout the year, across all functional areas.


Statement made in the Management Discussion & Analysis describing the companys objectives, projections, estimates, expectations may be "Forward-looking statements" within the meaning of applicable securities laws & regulations. Actual results could differ from those expressed or implied. Important factors that could make a difference to the Companys operations include economic conditions affecting demand supply and price conditions in the markets in which the company operates changes in the government regulations, tax laws & other statutes & other incidental factors.