Booming Revenues: Secondary Steel Sector Set for 7% Growth

Secondary steel producers are projected to experience a 7% revenue growth in this financial year, driven by strong domestic demand and government infrastructure projects. This follows a 4% revenue rise in the previous fiscal year, with increased volumes and higher capacity utilization bolstering financial performance.

Secondary steel manufacturers are poised for a significant 7% revenue growth this financial year, Crisil Ratings reported Thursday.

These producers, who recycle products via electric arc and induction furnaces, saw a 4% revenue increase last fiscal year.

This fiscal's revenue surge is partly fueled by robust domestic demand and central government investments in housing and infrastructure, according to the ratings agency. Notable spending under initiatives like Pradhan Mantri Awas Yojana and the National Infrastructure Pipeline is expected to sustain demand and increase pace in the latter half of the year.

Rahul Guha, Director at Crisil Ratings, highlighted increased volume and steady realization as key factors driving the sector's upward trajectory. The capacity utilization is expected to rise to 83%, boosting the Ebitda per tonne significantly.

(With inputs from agencies.)