Satyam Iron & Steel Company Private Limited is a pioneering sponge iron manufacturing enterprise that has evolved into a fully integrated steel plant. Over the past two financial years, the company has invested over INR 500 Crore, with plans to allocate a similar amount for expansion and production capacity enhancement in the upcoming financial years 2023-24 and 2024-25. It is often said that a resilient individual views adversity as a stepping stone toward success rather than an obstacle. Following this profound wisdom, Mr. Rahul Agarwal, a prominent industrialist, has effectively overseen the company since 2002 to address the challenge of sourcing quality raw materials at competitive prices. In a recent interaction with Tube & Pipe India, Mr. Rahul Agarwal, Director, Satyam Iron & Steel Company Private Limited, shared his insights into the company’s organizational structure, business strategies, and future endeavors.
Tube & Pipe India: Please tell us about Satyam Steel’s organizational setup.
Rahul Agarwal: Inaugurated in 2002 with a single 100 TPD sponge iron plant, the company has achieved remarkable growth and advancements in its technical and operational domains. The company swiftly expanded its capabilities by adding another 100 TPD sponge iron plant in 2003. By 2023, the company has undertaken significant developments, including the installation of a 200 TPD sponge iron unit with a capacity of 60,000 MTPA, three 15 ton induction furnaces with CCM with a capacity of 1,35,000 MTPA, a 60,000 MTPA capacity rolling mill, and a 15 MW captive power plant all situated in its sprawling 50-acre factory. The ongoing projects at Satyam Steel encompass a sponge iron plant with a capacity of 2,40,000 MTPA, MS billet production at 1,35,000 MTPA, rolling mill operations at 60,000 MTPA, and a 15 MW captive power plant, showcasing the company’s dedication to expansion and innovation in the steel industry.
TPI: Can you elaborate on the specific functions of each of your three subsidiaries?
RA: Satyam Steel is a fully integrated steel plant, and all the functions involved in the production of steel used as raw material for finished goods are carried out. Its products are sponge iron plants, MS billet, HR strips, captive power plants, and rolling mills.
BST Infratech Limited has for the last 20 years manufactured and supplied iron & steel products of the highest quality. Our current production capacity is approximately more than 2.5 lakh MT annually.
Recently, BST Infratech was awarded with ET Industry Leaders East, 2023 for being the leading manufacturer of high-class iron and steel goods. Our range of products includes MS HR strips with a production capacity of 1,50,000 MT per annum, M.S. ERW pipes available in round, square, and rectangular shapes, and G.I. pipes available in round and square shapes with a production capacity of 1,50,000 MT per annum, metal beam crash barriers having a production capacity of 15,000 MT per annum, swaged type steel poles with a production capacity of 15,000 MT per annum. We also have a power transmission tower with a production capacity of 15,000 MT per annum, and railway OHE galvanized structures and cantilever bracket tubes/guide tubes with a production capacity of 10,000 MT per annum.
Manbhum Ispat Pvt. Ltd. (BSPL), is a heavy structured re-rolling mill that produces better and improved M.S. angle, M. S. channel, M.S. joist, H-Beam, and M.S. unequal angle. It currently manufactures approximately up to 1,00,000 MT per annum of structural items required for general engineering purposes. It has been approved by organizations such as WBSETCL, SAIL, DVC, CORE, PSPCL and many more.
TPI: Satyam Steel has by and large provided you with raw material security. Please comment on this.
RA: The availability of high-quality raw materials at a good price is the game changer for any company associated with manufacturing and construction. In the past, especially in the iron and steel sector, people have faced difficulties in procuring raw materials at a fixed budget to produce better products. Several companies have been shut down due to this reason. Owing to this reason, Satyam Steel was established and it is a matter of pride for us to say that after so many years, it has been loved and accepted by a lot of people belonging to this industry. It has indeed provided us and others with the so-called raw material security all around the year. We have remained focused on manufacturing sponge iron since 2002. From 2023 onwards, billet and H.R. strips that would confirm the satisfactory standards of our clients have been added to our inventory. It is through serving them, shall we grow.
TPI: Is Satyam Steel planning on further investment in expansion?
RA: More than INR 500 crore have already been invested in the last two financial years, in Satyam Steel and we plan to invest more than INR 500 Crore in the upcoming financial years 2023-24 and 2024-25 to facilitate expansion and increase production capacity. In our vast factory in Mangalpur, Ranigunj, inside multiple sheds, all production work is carried out. Currently, we are concentrating our complete resources on doubling the total production capacity by the next financial year. Any other investment-related decisions will be taken after evaluating the performance and growing demands for the products after the end of this time period.
TPI: Do you follow the same business strategy in all three verticals, or are they different? What is your strategy for Satyam Steel?
RA: In a way, the business strategy for all three companies could be perceived as the same. For example, all three companies were built to provide exceptional products at the best prices to the iron and steel industry when the unavailability of good and affordable products was at its peak. The massive network of distributors, dealers, and fabricators who constantly buy our products know that due to their high strength, flexibility, and durability, our products are most suitable for general engineering and construction-related works. Our passion for creating a very efficient sales force for all three companies is our top priority. We have devoted our mission and vision to establishing proper work ethics and principles in our organizational system so that we would never compromise on product quality or customer delight.
TPI: What is your opinion about Green Steel production? Is it a viable option in India?
RA: Green steel, which refers to the steel produced through processes that do not emit carbon dioxide, and relies on hydrogen as the reducing agent (remover of oxygen) in steel production. Hydrogen is used to pull oxygen away from iron oxide, leaving pure iron behind to which a little carbon is added to make steel. Currently, the steel industry uses carbon, in the form of coke, which has been used for pulling away oxygen which generates carbon dioxide, a significant environmental concern. Hydrogen can effectively replace coke in this process. According to Australia’s Commonwealth Industrial and Scientific Research Organization (CSIRO),66 percent of India’s (and Australia’s) iron ore is not suitable for being made into green steel. This is because Indian iron ore is low-grade. Low-grade iron ore can only be made into steel in blast furnaces using huge cooking pots in which iron ore is melted and made to combine with coke, before being poured into moulds for making steel slabs. For technical reasons, green steel making requires the electric arc furnace (EAF) route and EAFs need high-grade ores, in which iron content is over 60 percent. Hydrogen releases very less heat and the use of hydrogen results in the embrittlement of iron, leading to cracks and fractures in the metal.
TPI: What are your vision and plans for your youngest subsidiary?
RA: The company’s vision is to continue expanding and innovating in the steel industry while maintaining a strong commitment to product quality and customer satisfaction. We are planning to invest INR 500 crore more to facilitate expansion and increase production capacity. Currently, we are concentrating our complete resources on doubling the total production capacity by the next financial year. Our vision is to establish proper work ethics and principles in our organizational system so that we never have to compromise on product quality or customer satisfaction.