Sunflag Steel will not raise prices in coming months

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In an exclusive interview with CNBC-TV18, ER Shekhar, Director, Sunflag Steel & Iron , spoke about the outlook for the company and his views on the sector.

Below is a verbatim transcript of the interview.

Q: When we spoke to you after your results, you said cost savings were good but you were looking for some more clarity in terms of pick up from auto sector which you cater to-has there been any traction and how are you demand panning out for auto space?

A: The last quarter was good but now our growth compared to last year will be more or less maintained at the rate of 14-15% in our turnover. The profits were much better last quarter. But overall we should be able to finish reasonably well when compared to last year.

Q: Could you tell us more about the auto sector, what kind of a volume uptick are you expecting from the kind of production and demand uptick that the entire auto sector is seeing?

A: I cannot tell you how the auto sector will behave. Much depends upon how they behave, so it's for you to tell me how the auto sector will behave.

Q: What about on the EBITDA level, you have seen a huge jump there, do you hope t maintain there about 15.5% and are you seeing any kind of input cost pressures?

A: Yes input pressures are there this quarter. We have a center plant going now which has helped us in controlling our costs but still the pressure on the increasing cost of inputs are there in the last few months or so.

Now that is where our margins will slightly get squeezed in the next quarter if we don't have any correction in our selling prices. But I don't think we have any chance of any raise now in the next few months of our costs. Integrated steel plants have raised their prices but there is a lot of resistance from the auto side to raise any prices.