OCTM GROUP PRESENTATION

CONTEMPORARY PRESSURE AND DRIVERS

STEEL INDUSTRY

PRESENTED BY:

AYUSH AGARWAL_11KA
GUNDRA LIKITH_19KA
SANJALI CHOUDARY_103KA
LAKSHYA SURI_209KA
 STEEL INDUSTRY BRIEF
ROBUST GROWTH:
India’s finished steel consumption is
anticipated to increase to 230 MT by 2030-31
from 119.17 MT in FY23.
India is the world’s second-largest producer of
crude steel, with an output of 125.32 MT of
crude steel and finished steel production of
121.29 MT in FY23.
INCREASING INVESTMENT:
The industry is witnessing consolidation of
players, which has led to investment by
entities from other sectors. The ongoing
consolidation also presents an opportunity to
global players to enter the Indian market.
POLICY SUPPORT:
In October 2021, the government announced
guidelines for the approved specialty steel
production-linked incentive (PLI) scheme.
*Under the Union Budget 2023-24, the
government allocated Rs. 70.15 crore (US$
8.6 million) to the Ministry of Steel.

COMPETITIVE ADVANTAGE

India’s steel production is estimated to grow 4-

7% to 123-127 MT in FY24.
Easy availability of low-cost manpower and
presence of abundant iron ore reserves make
India competitive in the global set up.
India is home to fifth-highest reserves of iron ore
in the world.
 Internal Organizational Change Drivers
Growth vs. Creativity:
Steel companies in India, such as Tata Steel and JSW
Steel, are continuously expanding their production
capacities to meet growing demand from various
sectors like construction, automotive, and
infrastructure. However, they also emphasize fostering
creativity and innovation within their organizations to
develop new products, processes, and technologies.
For instance, Tata Steel's focus on research and
development has led to the creation of advanced steel
grades suitable for modern applications like electric
vehicles.
Integration and Coordination:
With diverse operations spanning mining,
manufacturing, distribution, and sales, effective
integration and coordination are crucial for steel
companies in India. For example, companies like Steel
Authority of India Limited (SAIL) have implemented
cross-functional teams and integrated information
systems to streamline communication and
collaboration across different divisions. This ensures
efficient sharing of information, resources, and best
practices, ultimately enhancing overall operational
effectiveness.
New Chief Executive:
When a new CEO assumes leadership in a steel
company in India, it often signals a period of change
and strategic reorientation. For instance, when Indian
steelmaker Essar Steel appointed a new CEO, the
company underwent significant restructuring and
adopted a more customer-centric approach to stay
competitive in the market. The new CEO brought
fresh perspectives and initiatives, driving the company
towards improved performance and profitability.

Power and Politics: Corporate Identity:

In the Indian steel industry, power dynamics and
stakeholder interests play a significant role in decision-
making processes. For instance, during mergers and
acquisitions, negotiations often involve balancing the
interests of various stakeholders, including shareholders,
government entities, labor unions, and local communities.
Companies like ArcelorMittal Nippon Steel India
(formerly Essar Steel) had to navigate complex political
landscapes and stakeholder relationships during their
acquisition processes, requiring strategic alignment and
effective communication to ensure successful outcomes.
Establishing a strong corporate identity and shared
purpose is essential for steel companies in India to
differentiate themselves in the market and build brand
equity. For instance, companies like Jindal Steel &
Power Limited (JSPL) emphasize their commitment to
sustainability and social responsibility as part of their
corporate identity. Through initiatives such as
environmental conservation efforts and community
development projects, they reinforce their brand image
as responsible corporate citizens, which resonates with
customers, investors, and other stakeholders.
 ENVIRONMENTAL PRESSURE FOR CHANGE
FASHION MANDATE

Green Steel Production Government has released the

Innovations like hydrogen-based
steelmaking and carbon capture technology.
Additive Manufacturing
capability to produce intricate structures,
minimizing waste, and promoting rapid
prototyping
National Steel Policy 2017, which
has laid down the broad roadmap for
encouraging long term growth for
the Indian steel industry, both on
demand and supply sides, by 2030-
31

IoT & Big Data Analytics • The Factories Act, 1948

IoT enhances real-time monitoring for • The Dock Workers (Safety,
consistent steel quality and machinery Health and Welfare) Act
maintenance. • The Mines Act, 1952 and Mines
Big Data Analytics dives deep into vast Rules, 1955
datasets to refine production, bolster
• he Building & Other
quality control, and forecast demand
Construction Workers Act, 1996
 ENVIRONMENTAL PRESSURE FOR CHANGE
REPUTATION
Mini-mills are capable of
producing a wide range of
steel products, including
long products (such as bars
and rods) and flat products
(such as sheets and coils).
HYPERCOMPETITION
The concept of scrap based
mini-steel mills that disrupted
the long products steel market.
These mills primarily use
recycled scrap metal to produce
steel, in contrast to traditional
integrated steel mills that rely
on raw iron ore and coal.
GEOPOLITICS
Globalization of the steel industry
presents both opportunities and
challenges for India. It provides
access to new markets,
technologies, and investments, but
it also requires strategic planning
to navigate global competition,
manage raw material
dependencies, and respond to
dynamic market conditions