Inventory levels coming down
The Times of India, April 2, 2009, Page 19
Recovery Signs: With Revival In Demand, Companies Boost Production
Namrata Singh TNN
Mumbai: A sense of feel-good seems to be returning to key industry sectors like steel, cement and textiles, if diminishing inventory levels are anything to go by. The sectors which witnessed a severe liquidity crunch in the December quarter, leading up to February this year, are now breathing easy. Not only are inventory levels back to normal, but demand generation has also prompted companies to raise their production levels.
The inventory levels at JSW Steel, for instance, have come down from a peak of one month, in November-December, to two-and-a-half weeks. The company's production is up 40% from December levels. "Demand is far better than what it was in the December quarter. Easing of credit after the government's stimuli packages, has clearly helped," said Seshagiri Rao, finance director, JSW Steel. Steel demand rides mainly on growth in infrastructure and auto. While auto, which contributes 15% of the total steel demand, is still to reach a full bloom, a good growth is being witnessed in the construction activity in rural and semi-urban sectors.
This is also the reason why the cement sector is looking up. ‘‘Inventory levels have come down considerably and despatches are higher. Demand generation has come mainly from government agencies which have lifted cement stocks in bulk before the close of the financial year,'' said H M Bangur, managing director, Shree Cement.
Demand has been bolstered by land prices coming down in the rural and semi-urban areas, enabling affordable housing. ‘‘We are expecting an annual growth of 8.5% for 2008-09,'' said Bangur. The story in textiles is no different. Normalcy is said to have returned to the inventory position of the industry both, in domestic sales and exports. Working capital has freed up with the choke in the trade channel coming off.
‘‘It is true that industry situation has eased and the pace is back. There is a general feeling of positivity. And, if a stable government is formed, the industry would show good growth by September,'' said R K Dalmia, president, Century Textiles. Inventory levels had risen by 20% in October-November. Considering that uptil February, the situation was adverse for the textile sector, it is expected to post a marginal growth of 1-2% in 2008-09.
Investments in projects rising
Rajesh Chandramouli TNN
Chennai: Amidst all the gloom and doom hitting India Inc, a glimmer of hope is now visible with CMIE saying that in January-March 2009, project investments rose to a robust Rs 8.13 lakh crore, nearly double the Rs 4.24 lakh crore recorded in corresponding quarter of previous year.
Project investments, as classified by the Centre for Monitoring Indian Economy (CMIE), are the total of all new investment projects added during the quarter as per its survey on investment projects. These projects were either announced or proposed or were under various stages of implementation.
The Times of India, April 2, 2009, Page 19
Recovery Signs: With Revival In Demand, Companies Boost Production
Namrata Singh TNN
Mumbai: A sense of feel-good seems to be returning to key industry sectors like steel, cement and textiles, if diminishing inventory levels are anything to go by. The sectors which witnessed a severe liquidity crunch in the December quarter, leading up to February this year, are now breathing easy. Not only are inventory levels back to normal, but demand generation has also prompted companies to raise their production levels.
The inventory levels at JSW Steel, for instance, have come down from a peak of one month, in November-December, to two-and-a-half weeks. The company's production is up 40% from December levels. "Demand is far better than what it was in the December quarter. Easing of credit after the government's stimuli packages, has clearly helped," said Seshagiri Rao, finance director, JSW Steel. Steel demand rides mainly on growth in infrastructure and auto. While auto, which contributes 15% of the total steel demand, is still to reach a full bloom, a good growth is being witnessed in the construction activity in rural and semi-urban sectors.
This is also the reason why the cement sector is looking up. ‘‘Inventory levels have come down considerably and despatches are higher. Demand generation has come mainly from government agencies which have lifted cement stocks in bulk before the close of the financial year,'' said H M Bangur, managing director, Shree Cement.
Demand has been bolstered by land prices coming down in the rural and semi-urban areas, enabling affordable housing. ‘‘We are expecting an annual growth of 8.5% for 2008-09,'' said Bangur. The story in textiles is no different. Normalcy is said to have returned to the inventory position of the industry both, in domestic sales and exports. Working capital has freed up with the choke in the trade channel coming off.
‘‘It is true that industry situation has eased and the pace is back. There is a general feeling of positivity. And, if a stable government is formed, the industry would show good growth by September,'' said R K Dalmia, president, Century Textiles. Inventory levels had risen by 20% in October-November. Considering that uptil February, the situation was adverse for the textile sector, it is expected to post a marginal growth of 1-2% in 2008-09.
Investments in projects rising
Rajesh Chandramouli TNN
Chennai: Amidst all the gloom and doom hitting India Inc, a glimmer of hope is now visible with CMIE saying that in January-March 2009, project investments rose to a robust Rs 8.13 lakh crore, nearly double the Rs 4.24 lakh crore recorded in corresponding quarter of previous year.
Project investments, as classified by the Centre for Monitoring Indian Economy (CMIE), are the total of all new investment projects added during the quarter as per its survey on investment projects. These projects were either announced or proposed or were under various stages of implementation.
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