Steel Strips Wheels eyes 20% topline growth this year

1537 Investors following Steel Strips Wh. Share this News with them.

0

Like this story, share it with millions of investors on M3

Steel Strips Wheels eyes 20% topline growth this year

Auto ancillary player, Steel Strips Wheels expects interest rates to soften by fourth quarter and sees demand picking up ahead.

Post your opinion here

 

0

Tweet

Share on Tumblr

Excerpts from Midcap Radar on CNBC-TV18 Watch the full show » ALSO READ See latest News about Steel Strips Wh See previous management interviews See what other Experts & Brokerages are saying about Steel Strips Wh Steel Strips Wh BSE | NSE 29/05/12 Are Mutual Funds betting on Steel Strips Wh?

Auto ancillary player, Steel Strips Wheels expects interest rates to soften by fourth quarter and sees demand picking up ahead.

Citing the growth outlook, Dheeraj Garg, managing director, Steel Strips in an interview to CNBC-TV18 said, "Operating margins will be better than last year because our product mix has shifted to trucks and tractor wheels."

In terms of the topline, the company is eyeing 20% growth over last year based on its performance in August. "We will still maintain growth for the whole year at about 20%," he added.

Also Read: Illegal mining issue unlikely to impact us says Bhushan Steel

Below is the edited transcript of Garg's interview with Gautam Broker and Latha Venkatesh of CNBC-TV18. Also watch the accompanying video.

Q: There have been concerns surrounding the domestic demand on whether the rate cycle would weigh a bit on the auto sector. How is the business looking like at your company? Do you anticipate further pressure going forward?

A: This month has been the toughest month for us but it is because of the macro issues in the market. Going forward, the exports are looking very good - 100% growth rate so that is helping us along the way.

Q: How are you looking at the industry in terms of the anecdotal evidence of growth slow down? The auto sales numbers are not looking too bad. Most of the two wheelers have reported fairly healthy sales - Mahindra is not bad, Tatas have been showing a fall in passenger vehicles but not in commercial vehicles. What is the feeling that you are getting? Are things getting tougher from the automobile industry in terms of demand?

A: The schedule from September is certainly better than August and things are getting better now.

Q: These things look better in September because people restock for the festival season is this any better than the usual festival season or worse?

A: We are factoring in a flat growth in September so we are not expecting a major growth in September. But, we will tide over it once the monetary policy calls for softening of interest rates which should happen by the fourth quarter. Demand should pick up. I don't see any structural problem in the market right now.

Q: Would you think until calendar 2011 ends out things could remain under constrain?

A: They will slowing improve, nothing drastic is going to happen. But I do not think it will go bad from hereon.

Q: We just heard some of the steel companies raising raw material prices and product prices. How is raw material price at your end - are you seeing it flatten out at a higher level or still inching higher?

A: It has certainly flatten out and as things go along the second quarter things might call for a little bit of reduction. I don't think there is inflationary pressure from steel.

Q: You mentioned exports about 70% growth in December and now you mentioned 100% growth - are you still maintaining that global headwinds not weighing on?

A: So far so good. We are doing exactly as per plan and at the moment we have no headwinds blowing on us on this issue.

Q: What do you think you will end the year with in terms of income and operating margins?

A: Operating margins will be better than last year because our product mix has shifted to trucks and tractor wheels. In terms of the top line, in terms of numbers we are looking about a 20% growth over last year that what it is based on the performance in August. But we still maintain our growth for the whole year at about 20%.