Corporate Grapevine

Published: Dec 29, 2021
Updated: Dec 29, 2021

JINDAL SAW: Focusing on speciality products

Maintaining that “the allocation by the government in the Union budget 2021-22 towards the infrastructure segment shall lead to the economy’s upliftment,” Prithavi Raj Jindal, Chairman says, “A few measures likes extending 7,400 projects under the national infrastructure pipeline project, allocating Rs 5,54,000 crore towards capital expenditure and Rs 40,000 crore towards rural infrastructure certainly augur well for us. Similarly, a record FDI inflow of an estimated $ 81 billion during FY21 proves the fact that India remains a favourite destination for foreign investors.”

Elaborating on the energy scenario going forward, Mr Jindal says, “The energy demand of India is anticipated to grow faster than the energy demand of all major economies, on the back of continuous robust economic growth. Foreign Direct Investment in the petroleum and natural gas sector is expected to go up to $ 7.91 billion by the third quarter of FY22. With an additional 17,000 km of gas pipeline in 2022, India’s natural gas grid is expected to expand to 34,500 km, while the reconversion of natural gas will reach 61 million metric tonnes a year, as opposed to 42 million metric tonnes earlier.”

According to him, “the government’s continued focus on ‘Atmanirbhar Bharat’ and its emphasis on investment in infrastructure and development will provide a boost to the overall demand of basic commodities. In addition, a reasonable rate of interest will provide liquidity in the system, which in turn will keep the Indian economy growing further.”

The company’s strategic business is broadly divided into four divisions, and their respective installed manufacturing capacities are: SAW pipes (1.5 million mtpa), including stainless steel pipes and tubes, DI pipes and pig iron (8 lakh mtpa), seamless tubes & pipes (3.5 lakh mtpa) and iron ore and pellets (1.5 million mtpa)

FACILITY UPGRADE

“In the last two years, the company has increased its focus on special products such as PU-coated pipes and double-chamber pipes to retain its market edge and improve sales. Similarly, facility upgradation is also being considered in the context of the expected increase in demand as the government implements the Jal Jeevan Mission (JJM), under which supply of water has reached approximately 41.97 million households (as of May 2021) through tap connections, vis-à-vis the targeted 191.96 million households by 2024 in rural India. A total budget of more than Rs 3,50,000 crore has been outlined for the JJM, giving a major boost to the pipe industry.

Similar initiatives by state governments have also resulted in an increased demand for pipes,” explains Mr Jindal. Commenting further on the ambitious JJM, Mr Jindal says, “The mission has gained momentum as most of the states and Union territories have planned their water grid systems and are in the process of rolling out the pipe network to ensure water supply to homes within a defined timeline. These initiatives of the government make us hopeful of a robust and steady demand for our products.”

Regarding the company’s preparedness, Mr Jindal says, “We are confident of emerging stronger and integrating better with markets in India and abroad, and remaining a market leader as and when the domestic and global economy bounce back.”

JSAW is a leading global manufacturer and supplier of iron and steel pipe products, pipe accessories and pellets, with its manufacturing facilities located in India, the US and the UAE. The company’s strategic business is broadly divided into four divisions, and their respective installed Prithavi Raj Jindal, Chairman manufacturing capacities are: SAW pipes (1.5 million mtpa), including stainless steel pipes and tubes, DI pipes and pig iron (8 lakh mtpa), seamless tubes & pipes (3.5 lakh mtpa) and iron ore and pellets (1.5 million mtpa).

S.A.W. PIPES

“The company leads the Indian market when it comes to the manufacture of large diameter submerged arc welded (SAW) pipes, primarily used for the transportation of oil, gas, slurry water and in structural applications,” informs Mr Jindal. Started in 1987, the company now has nine state-of-the-art pipe manufacturing plants at several locations across India and one in the US, each equipped with the requisite anti-corrosion coating facility and with a combined capacity of approximately two million mtpa for line pipes.

“A total budget of more than Rs 3,50,000 crore has been outlined for the Jal Jeevn Mission, giving a major boost to the pipe industry. Similar initiatives by state governments have also resulted in an increased demand for pipes,

“The government’s continued focus on ‘Atmanirbhar Bharat’ and its emphasis on investment in infrastructure and development will provide a boost to the overall demand of basic commodities. In addition, a reasonable rate of interest will provide liquidity in the system, which in turn will keep the Indian economy growing further.”

“With a hot induction bend manufacturing facility and two major CWC coating plants, JSAW is the only total pipe solutions company in the world with the distinction of exporting 17,000 km of higher API grade pipes, to become the second largest pipe exporter in the India Pacific region after Japan. Further, we have also supplied 36,000+ km of line pipes for onshore and offshore pipeline projects all across the world,” informs Mr Jindal.

Commenting on the demand scenario for SAW Pipes, Mr Jindal says, “Firmness in international oil prices continues to support the LSAW pipe outlook. We are the market leader with a total capacity of 1.5 million mtpa of both LSAW and HSAW pipes. The current order book stands at 2.17 lakh tonnes.”

ENHANCING VALUE

“In order to create greater synergies and a unified structure, we intend to merge our stainless steel and DI fitting business and another HSAW unit with the JSAW. In fact, recently we constituted a committee to explore/ evaluate options of consolidation/restructuring various subsidiaries, affiliates and associates of the company so as to realise operational efficiencies due to optimal utilisation of resources, reduction in administrative costs and a lean organization, with the objective of maximizing value for all stakeholders,” notes Mr Jindal.

DI PIPES, PIG IRON

“The integrated greenfield project for ductile iron (DI) pipes and the pig iron unit located at Samaghogho in Mundra, with a 500,000 mtpa capacity, has the advantage of two nearby ports — Mundra and Kandla. The plant is well-equipped with a coke oven battery plant, a sinter plant and a blast furnace and produces DI pipes up to sizes of 2,200 mm,” says Mr Jindal.

“To meet the increasing demand on the exports side, the company is also upgrading the Samaghogha unit, with a focus on pipes in the size range of 80-300 mm,” says Mr Jindal.

ABU DHABI UNIT

Another manufacturing unit for DI pipes is located at Abu Dhabi, UAE with a capacity of 3,00,000 mtpa, which primarily caters to the MENA region and European markets.

Considering the increase in demand for large diameter pipes in the Gulf region, an expansion is being planned in the Abu Dhabi unit to increase the capacity for pipes in the range of 1,400 mm and above. This additional capacity is expected to be commissioned by the first quarter of CY2022.

Elaborating, Mr Jindal says, “DI pipes carry fluids from clean drinking water to waste water. JSAW has attained the mantle of being the third largest producer of DI pipes in the world with a combined current capacity of 8,00,000 mtpa comprising of two units.

The DI fitting and manufacturing facility at Tembhurni, Solapur operates at an annual capacity of 18,000 mt. It supplies pipes and fittings to more than 40 countries. China constitutes 65% of the global market share in the DI pipes segment.”

Seamless and Stainless Steel Pipes

The seamless and stainless steel pipestubes division produces stainless steel pipes (seamless and welded) as well as carbon steel products and alloy steel pipes, both seamless, with an installed capacity of 3,50,000 mtpa, equipped with a state-of-the-art PQF mill from SMS MEER, Germany. These pipes and tubes are mainly utilised in oil & gas exploration and drilling, power, defence, transportation of petro and petroleum products, automobiles and bearing industry, refineries and fertilisers.