Indian steel companies are focusing on reducing costs and improving efficiency rather than expanding their production, as increasing imports put pressure on prices and profits, analysts said. India plans to reach 300 million tonnes (mt) of crude steel capacity by 2030, but companies are being cautious about big investments due to market uncertainties.
“Steel makers are now focusing more on improving efficiency and cutting costs instead of adding new capacity, as rising imports are affecting local prices,” said Amit Bhargava, partner at KPMG in India. Many industry experts are worried about growing steel imports from China and South Korea. The recent trade disputes have added to the uncertainty, making companies hesitant to invest.
“Instead of announcing big expansion plans, companies are trying to make the most of their existing capacity and keep costs under control,” said Ritabrata Ghosh, vice president at ICRA. India currently has around 180 mt of crude steel capacity, and reaching 300 mt in the next five years will require nearly $120 billion in investment. However, companies are reluctant to take on large debts in the current situation.
Analysts predict that steel companies’ profits may remain flat next year. Rohit Sadaka, director at Ind-Ra, said profitability is expected to stay steady in 2025-26.
