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A C ChoksiShare Brokers Private LimitedA C Choksi Institutional Research |Initiation Report|MINING MOILApril 26, 2011Indian Steel Sector in Global MapExhibit 26.2010 Crude Steel ProductionWorld crude steel production in 2010* (in million tonne)Rank Country Production1 China 6272 Japan 1103 USA 814 Russia 675 India 676 South Korea 587 Germany 448 Ukraine 349 Brazil 3310 Turkey 29Source: World Steel Association, Ministry of Steel, Govt. of India, A C Choksi Institutional ResearchGlobal crude steel production grew at a 10 year CAGR of 5.2%.Based on provisional numbers it grew at a whopping 15.5% in2010 over 2009.Exhibit 27.GDP growth of Indiain the last decadeIndia produced ~67 million tonnes, 4.7% of world production;it emerged as the 5th largest producer in 2010 and recorded agrowth of 11.3 per cent over 2009. India also is the largest spongeiron producing country in the world in 2010. As per Ministry ofSteel, India may become the second largest crude steel producer inthe world by 2015-16 if expansion plans are implemented asproposed.10%9%8%7%6%5%4%3%2%1%0%FY 91-00 FY 01-10 FY 04-08 FY 07-08 FY 08-09 FY 09-10China was the largest producer with ~627 million tonnes. Itrepresented 44.3% of the total world steel production.With global growth back on track we believe, we should see higherconsumption of steel by growing economies of the world.India, being one of the fastest growing economies of the world isexpected to consume more of steel in future years if at best it growsat a rate higher than the rate at which it has been growing in the last6-7 years. Even if it grows at the current rate we do not expect it toconsume lesser steel until any global economic environment turnsadverse._____________________________________________________________________________________A C Choksi Institutional Researchresearch@acchoksi.com 22
A C ChoksiShare Brokers Private LimitedA C Choksi Institutional Research |Initiation Report|MINING MOILApril 26, 2011Exhibit 28.Global Ferro Alloy demand-supply scenarioGlobal & Domestic Ferro & Manganese Alloy PictureSupply 2004 2005 2006 2007 CAGR (%)HC FeMn 3,820 3,584 4,051 4,432 5.1Ref FeMn 968 1,023 1,068 1,125 5.1SiMn 6,010 6,048 6,688 7,600 8.1TOTAL 10,798 10,655 11,807 13,157 6.8DemandHC FeMn 3,764 3,667 4,093 4,724 7.9Ref FeMn 1,007 1,070 1,060 1,176 5.3SiMn 5,960 6,104 6,595 7,659 8.7TOTAL 10,731 10,841 11,748 13,559 8.1BalanceHC FeMn 56 -83 -42 -292Ref FeMn -39 -47 8 -51SiMn 50 -56 93 -59TOTAL 67 -186 59 -402Source: RHP, Eurasian Natural Resources Corporation (ENRC) presentations, A C Choksi Institutional ResearchExhibit 29.Global Manganese Alloy Production ShareOther Europe2%CIS15%EEA8%China47%India7%Other21%Asia (other)4% Japan4%Americas6%Africa &Middle East7%Source: RHP, CARE Research, A C Choksi Institutional Research_____________________________________________________________________________________A C Choksi Institutional Researchresearch@acchoksi.com 23
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