Home ›› 07 Dec 2021 ›› Stock
BSRM Steels Limited, one of the country’s leading steelmakers, will put its under-construction MS rod plant into operation by the middle of fiscal 2023-24.
Once the plant is fully operational, the company’s MS rod manufacturing capacity is expected to increase to 14 lakh metric tonnes per year, according to the company’s latest financial report.
In October this year, BSRM Steels announced to set up the plant with an investment of Tk 1,850 crore, including Tk 700 crore planned in the previous year.
The company board has recently approved the investment plan for setting up the new bar and wire rolling and expansion of melting unit to enhance the capacity of rolling by 6 lakh metric tonnes and melting 2.5 lakh metric tonnes per year to cater to the growing demand for quality steel products.
“In the new plant, we’re also leveraging technology to enhance our environmental responsiveness and on course to establishing best-in-class manufacturing and distribution facilities to improve our operational and environmental performance,” BSRM Steels Managing Director Aameir Alihussain was quoted as saying in the report.
The steelmaker witnessed stellar growth in profits in FY21 and surpassed the pre-pandemic level, it said.
Its profit stood at Tk 305 crore in FY21, a significant jump from Tk 74 crore recorded in FY20 hit hardest by the pandemic. Its pre-pandemic level profit was Tk 173 crore in FY19.
“We achieved a net profit after tax of Tk 305 crore, driven by multiple factors including improved market environment, a better product mix, continued cost control programmes and benefits derived through operational and financial efficiency,” said Alihussain.
“Most of the steel-consuming sectors rebounded with support from government spending, pent-up demand and easing liquidity.”
The steelmaker is now eying good business in the coming days as the country’s economy is projected by the International Monetary Fund (IMF) to grow 6.5 per cent in the FY22, which is much lower than the government’s projection of 7.2 per cent.
On the other hand, myriad infrastructure development projects, such as bridges, airports, highways, metro rail, economic zones and power plants, are at the finishing stage and waiting for grand opening in the country.
Against the backdrop, demand for MS products will increase sharply in the upcoming years, the company forecast.
According to industry reports, per-capita annual steel consumption in Bangladesh stood at 45 kg in 2018, having doubled in the previous five-eight years. BSRM believes it has already reached 55 kg.
Government megaprojects are the major growth drivers which now consume over one-third of the steel, up from less than 15 per cent a decade ago.
According to the annual report, with the new projects, the company has also made progress in its steel recycling business initiative, which is a definitive step towards sustainable steel production.
This fact will enable BSRM Steels to achieve lower carbon emissions, resource consumption and energy utilisation.
On Monday, its share price declined 1.23 per cent to Tk 72 on the Dhaka Stock Exchange.
Listed in 2009, BSRM Steels’ market capitalisation stood at Tk 2,740 crore as of Monday. Its paid-up capital is Tk 374 crore. The company has Tk 1,761 crore in surplus reserve.
