Uttam Galva guns for galvanised steel

Uttam Galva Steels Ltd (UGSL) typically procures hot rolled steel (HR) and processes it into CR and further into GP and colour coated coils. In galvanised coils, it specialises in making ultra- thin sheets, which could be as low as 0.13mm thickness. The excess capacity of CR which is not used for galvanising is converted to value-added grades in Cold Rolled Closed Annealed (CRCA) coils, cut to length sheets and also sold as Full Hard CR in the overseas markets. At present, UGSL exports over 70 percent of its products to over 141 countries worldwide. Around 50 percent of UGSL’s domestic sales come from the auto sector; it is a supplier to a number of OEMs including Mahindra & Mahindra, Bajaj Auto, Tata Motors, Force Motors and Piaggio. While 80 percent of this domestic demand is for CR steel, the company is keen to capitalise on the growing demand for galvanised steel in the country.

Why galvanised steel?

While there is no doubt that steel is a versatile product with a vast range of applications, it tends to corrode. Therefore, automakers worldwide are looking at galvanised steel as a solution to this problem.

Galvanised steel helps provide extended service life and its use in body panels by automobile manufacturers allows them to guarantee a corrosion-free life of 12 years, at a marginally higher cost compared to conventional steel.

Galvanised steel can be made through a thick zinc layer coated on carbon steel, which helps it remains rust-free. Zinc coatings can be applied to steel in two different processes: hot dip or electrolytic galvanising.

The steel gets coated in layers of zinc because rust doesn’t attack this protective metal.

Other benefits of galvanised steel include high strength, light weight, recyclability, aesthetics and reduced cost. Most modern automakers are taking to using this material. UGSL's facility at Khopoli in Maharashtra gives it logistical benefits for imports and exports as supplies to OEMs are within 500km. In the near future, the company plans to look beyond Maharashtra.

A year ago, the company completed its expansion and modernisation programme at the Khopoli plant to increase its CR capacity to one million MT per annum and galvanised steel capacity to 750,000 MT per annum. Given the recent positive changes in the economy, it is now optimistic that these increased volumes will be absorbed by the domestic and export markets. Uttam Galva also plans to invest Rs 400 crore in doubling its service centre's capacity to 40,000 tonnes a month.

According to Ankit Miglani, director – commercial, “Historically our spread has been 70 percent exports and the rest imports. In India, demand for steel has constantly been picking up. Now with positive global indications of things getting better, we are targeting at least 50 per cent exports and imports. In that sense our domestic focus will certainly go up.”

He adds, “The demand for both cold rolled and galvanised steel is picking up in India. In fact, demand for galvanised steel will grow thanks to global automakers setting up operations here and Indian companies looking to export. Typically, global carmakers use galvanised steel. So those setting up shop here (or looking at exports) can’t afford to have two standards. Seeing this we have already invested in the galvanised unit.”

As part of its modernisation programme, UGSL has also invested in improving production and overall quality levels of its manufacturing processes and finished products and intends to increase its production of higher value-added products. It now has an entire range of cold rolling reversible mills — 20-Hi, 6-Hi, 4-Hi and newly commissioned twin stand 6-Hi mill.

Miglani concludes, “All these measures further strengthen our position as one of the leading companies in the cold rolled and the galvanised steel market. With around 77 percent of the cold rolled production being transferred to galvanised, we are capable of catering to this new spectrum of galvanised steel demand.”