JSW Steel - Crude Steel Production at 2.96 Million Tons in Q1 FY 2020-21

JSW Steel achieved crude steel production of 2.96 million tons in Q1 FY 2020-21. The average capacity utilisation dropped to 76% in June 2020, primarily due to a fall in production at Vijayanagar Works.

At Vijayanagar Works, certain employees tested Covid-19 positive (started with an employee who had travelled far away from plant premises on personal work and got infected). This has led to not only hospitalisation of these employees, and an active contact tracing and quarantining of their primary and secondary contacts, but also imposition of restrictions by the local administration on the entry and exit of employees at the plant location. The Company responded promptly and responsibly to control the spread of Covid-19 infection among our workforce and local communities by implementing and intensifying comprehensive prevention and mitigation measures, by leveraging on our existing medical infrastructure and community outreach programme. The Company identified the workforce (including those who resided outside township premises) critical for operation of the plant and made arrangements to accommodate all of them within the townships premises, thus, completely restricting the movement of personnel into and out of factory premises. The Company has been scrupulously following the guidelines, protocols and instructions issued by the local administration from time to time. It is also heartening to see that a majority of such infected employees have also recovered since. The operations are now stabilising with reduced employee strength.

The Company has been declared as the "Preferred Bidder" for four iron ore mines in the State of Odisha, in the Auctions held by the State Government in February 2020.

The Govt. of Odisha has issued vesting orders in respect of these mining blocks viz:-Nuagaon, Narayanposhi, Jajang and Ganua by virtue of which all valid rights, approvals, clearances, licenses and the like vested with the previous Lessee(s) have been deemed to have been acquired by the Company. The Company has signed the Mine Development and Production agreement(s) for all the four blocks and executed the lease deed(s)with Govt. of Odisha after complying with all regulatory aspects.

The Company has also started mining operations at all the above said blocks from 1st July 2020. These mines in aggregate have over one billion tonnes of reserves and were operating prior to their closure in March 2020 with environmental clearance to produce upto 29.3 million tonnes annually. The earlier Lessee(s) produced an average of 21.65 million tonnes of iron ore from these mines in the last two years. The Company expects to meet a majority of its requirements of iron ore from these mines, reducing its dependency in sourcing the ore from merchant miners in the State of Odisha.

Shares of JSW STEEL LTD. was last trading in BSE at Rs.194.5 as compared to the previous close of Rs. 191.5. The total number of shares traded during the day was 327866 in over 3277 trades.

The stock hit an intraday high of Rs. 194.9 and intraday low of 190.1. The net turnover during the day was Rs. 63193763.

Source : Equity Bulls

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