Essar Steel may convert loans in equities

Mumbai: Essar Steel Ltd is planning to convert secured and unsecured loans into equities. The company board at its meeting on 19 July 2002 will take a decision on this regard.

Improvement in the steel sector has helped Essar Steel, Indias largest hot-rolled steel coil exporter, to announce a lower net loss of Rs 186 crore for the fourth quarter ended 31 March 2002, compared to Rs 367 crore registered in the same period last year.

For the financial year ended 31 March 2002, the loss stood at Rs 635 crore, compared to Rs 346 crore in the previous year. The 2.4-million-tonne company attributed the annual performance to a drop in sales realisation by 13 per cent.

The total income of the company fell 9 per cent to Rs 496 crore, compared to Rs 549 crore in the same quarter last year. While the companys performance is in line with global trends, market sentiments are expected to improve in the days to follow. In the past couple of weeks, there has been an improvement in HRC prices in a range between $25 and $30 per tonne. Domestic prices also rose by an average of Rs 1,500 per tonne.

Exports, which were the mainstay of the company, have now come down due to restrictive trade barriers in major steel markets overseas. While exports were 40 per cent of the earlier sales, domestic sales have risen by 13 per cent in the current year. Exports were down to 4 lakh tonnes against 7 lakh tonnes in the previous year.