METALS INDUSTRY IN INDIA - IBEF

[Pages:19]METALS INDUSTRY IN INDIA

September 2009

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METALS INDUSTRY IN INDIA September 2009

The Indian metals industry has two main segments

Non-ferrous metals

Indian metals industry

? Non-ferrous metals include aluminium, copper, zinc, lead, nickel and tin.

? Demand for non-ferrous metals comes from sectors such as agriculture, automobiles, railways, telecommunications, construction and chemicals.

Ferrous metals

? Ferrous metals primarily consists of iron and different varieties of steel

? Demand for ferrous metals comes from construction and automobile sectors

Metals is a key sector as it meets the requirements of a wide range of important industries.

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METALS INDUSTRY IN INDIA September 2009

The industry is highly fragmented

Type of metal

Industry structure

Secondary producers

Non-ferrous metals

Ferrous metals

Primary producers

Has only a few players

Secondary producers

Many players in the organized and unorganized sectors

Ore miners

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Integrated / main producers

Re-rollers

Stand-alone producers

METALS INDUSTRY IN INDIA September 2009

The steel sector in India has been growing rapidly

While production of pig iron has been fluctuating over the years...

Production of Pig Iron

...Production of finished steel has been growing steadily

Production of Finished Steel

Million Tonnes

Million Tonnes

*-Estimate

India is the fifth largest producer of crude steel

*-Estimate

Top producers of Crude Steel in 2008

Growth in manufacturing and infrastructure is fuelling demand for steel products, thereby driving growth in the sector

Million Tons

Source: Ministry of Steel, GoI; World Steel Association

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METALS INDUSTRY IN INDIA September 2009

Steel trade out of India has also been going up...

Exports growing at a healthy 20 per cent CAGR; but imports growing at double the rate...

Exports of Steel from India

Imports of Steel into India

US$ Billion

US$ Billion

US$ Million

Belgium and USA are key exports markets

Top 10 steel exports destinations(2008-09 Apr-Dec)

700 600 500 400 300 200 100

0

US$ Million

China and Korea are the key sources

for imports

Top 10 steel imports sources(2008-09 Apr-Dec)

1,600 1,400 1,200 1,000

800 600 400 200

0

Source: Export Import Data Bank, Ministry of Commerce, GoI - merce.nic.in

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METALS INDUSTRY IN INDIA September 2009

The aluminium sector in India is concentrated among three key players, and is growing

Key players in the Indian aluminium sector

Group

Key Players

Aditya Birla Group

Hindalco Industries Limited Indian Aluminium Company Limited (Indal)

Sterlite Industries

Bharat Aluminium Company Limited (Balco) Madras Aluminium Company Limited (Malco)

Public Sector

National Aluminium Company Limited (Nalco)

Primary aluminium production

Aluminium consumption by sector-2008

CAGR 12%

000 Tonnes

The production of aluminium has been growing at a CAGR of over 10 per cent

Source: ICRA Industry report ? Metals: Aluminium and Copper, June 2008

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The key consumers are the electrical, automotive and construction sectors

METALS INDUSTRY IN INDIA September 2009

The copper industry has also shown steady growth

Production growing at a CAGR of 15 per cent

Copper production in India

Hindalco and Sterlite account for more than 90 per cent of the output

Copper Industry Market Share

000 Tonnes

Source: ICRA Sector Analysis, June 2008

Key applications: ? Wires ? Cables ? A/C and refrigeration tubings

Source: ICRA Sector Analysis, June 2008

Key user sectors: ? Telecom ? Power ? Engineering ? Auto ? Consumer Durables ? Defence

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METALS INDUSTRY IN INDIA September 2009

Zinc production and consumption have been increasing, primarily for galvanising

Production of Zinc

Zinc market segmentation

000 Tonnes

000 Tonnes

Zinc Consumption

Source: Industry analysts reports, October 2008

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Zinc products

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