Bright Future For Steel With Thrust On Infra Boost, Says Anurag Agarwal, ED, MSAF

MS Agarwal Foundries Pvt. Ltd. (MSAF) is one among leading steel producers in India. It is one of India's largest private steel manufacturers with a legacy spanning over three decades. Having a turnover of Rs. 2500 crores in FY24, MSAF stands as a cornerstone of excellence in the steel manufacturing industry and is renowned for producing high-quality virgin steel, under the brand names AF STAR (a project brand) and MS LIFE (a retail brand).

MS Agarwal Foundries Executive Director Anurag Agarwal, says the demand for steel is expected to see a steep increase due to focus on housing, highway expansion, port-led development and reduction of logistics cost . In an exclusive interview to Bizz Buzz, he said there is a bright future for the brownfield and greenfield players in the industry due to growing demand.

Driven by a passion for innovation and customized solutions through the use of cutting-edge technologies, he said MSAF boasts a production capacity of 6 lakh MT of steel per year. It operates with an efficiency level of 95 per cent, ensuring consistent quality and reliability in its products. MSAF envisions reaching an annual sales volume of 1.2 million tonnes per annum by 2026-27 to further solidify its position as a leader in the industry

What have been the defining milestones and achievements in MS Agarwal Foundries Pvt Ltd (MSAF)’s growth since its inception?

MSAF, established in 2005, has grown to become a key player in South India’s steel manufacturing industry. MSAF is renowned for producing high-quality TMT bars, including Fe 550D, Fe 550D Epoxy Coated, and stainless steel rebars, catering to the

diverse needs of the construction industry, from residential buildings to major infrastructure projects such as highways, railways, and ports.

With a workforce of over 2000+ employees, MSAF fosters career development and a safe work environment under the leadership of Pramod Agarwal (Managing Director) and myself. As part of its long-term vision, MSAF targets achieving a production capacity of 1.2 MTPA by FY 2026-27, positioning itself as a leader in India's steel industry.

How would you describe the current landscape of the steel industry in India, and what emerging trends are most significant?

As the second-largest steel producer in the world, India’s steel sector is crucial to its economic development. The government's initiatives, such as the National Steel Policy (NSP) 2017, which targets increasing steel production capacity to 300 million tonnes by 2030, underscore this importance. Domestic demand for steel is surging, driven by large-scale infrastructure projects like roads, railways, ports, and airports, alongside urbanization and real estate development. In this dynamic landscape, MSAF is deeply committed to integrating sustainability, innovation, and global expansion into its operations. The company’s adoption of Electric Arc Furnaces has not only modernized its production facilities but also exemplified its commitment to environmental responsibility.

Can you provide an overview of MSAF’s current financial performance and what you anticipate for the coming years?

MSAF has shown impressive growth across its financial metrics over recent years, Turnover has grown significantly (78%), highlighting MSAF’s ability to scale in response to increasing demand and optimized production processes. Sales volumes have

consistently risen, with MSAF exceeding its nominal production capacity, demonstrating its ability to push operational limits and meet market needs efficiently. MSAF’s EBITDA growth of 102%, was driven by higher margins, cost controls, and increased sales. The company’s focus on profitability while expanding operations has strengthened its financial standing.

What are the major challenges facing the steel sector today, and what opportunities are MSAF leveraging to stay ahead?

The steel industry faces challenges like volatile raw material prices, rising energy costs, and strict environmental regulations. MSAF addresses these issues by investing in renewable energy, adopting Electric Arc Furnaces (EAF) to reduce carbon emissions, and expanding production capacity with new facilities and efficient utilization of existing ones. The company enhancesoperational efficiency through 5S, Kaizen, and Six Sigma methodologies, and drives digital transformation with ERP, CRM, and HRMS technologies. MSAF is also exploring joint ventures and expanding into new markets across Asia and Africa to diversify its product offerings and reduce market dependency. By fostering continuous innovation and improvement, MSAF positions itself as a leader in sustainable steel manufacturing, ready to adapt and thrive in a competitive landscape.

Could you explain the scope and the impact of the ongoing expansions of your plants in Naidupeta in Andhra Pradesh and Medak in Telangana?

The expansions at MSAF's Naidupeta and Medak plants mark a key step in the company’s growth strategy and commitment to operational excellence. At Naidupeta, the focus is on increasing production capacity, integrating advanced machinery, and improving infrastructure to meet rising demand. Similarly, the Medak plant expansion will boost production with new lines and energy-efficient technologies, emphasizing sustainability. These expansions will enhance MSAF's market position by increasing output, optimizing efficiency, and ensuring timely deliveries, all while fostering customer loyalty. Additionally, it will lead to creating job opportunities and supporting local communities, reflecting MSAF’s commitment to sustainable growth and community development.

What innovative technologies are adopted in your new projects to ensure efficiency and sustainability?

MSAF has integrated advanced technologies into its new projects to boost efficiency and sustainability. Key innovations include the adoption of Electric Arc Furnaces (EAFs), which are more energy-efficient and environmentally friendly than traditional methods, aligning with MSAF’s sustainability goals. Automation and robotics enhance production speed and quality control, while energy-efficient equipment and waste heat recovery systems reduce energy consumption and costs.

What are the key strategies for driving MSAF growth in production and sales and how they are being executed?

MSAF is on an ambitious growth trajectory, emphasizing production expansion and market diversification. Key initiatives include strategic acquisitions, greenfield projects, and international expansion, particularly into Europe and the UK. MSAF is enhancing its production capacity through targeted acquisitions, integrating new facilities to boost overall capacity and operational efficiency. Concurrently, the company is investing in greenfield projects, constructing state-of-the-art facilities that emphasize efficiency and sustainability. A significant part of MSAF’s strategy is its entry into the European and UK markets. This expansion aims to diversify beyond the Indian market and tap into Europe’s growing demand for sustainable steel.

What are MSAF’s long-term goals, and how do you envision the company’s evolution in the context of industry advancements?

At MSAF, our long-term goal is to achieve a production capacity of 1.2 million tonnes per annum (MTPA) by the fiscal year 2026-27, reflecting our commitment to scaling operations and enhancing market presence.

We are broadening our market coverage across India and diversifying into sectors like government contracts, retail, and various industries, strengthening our customer base.

We are modernizing operations with Electric Arc Furnace (EAF) technology and planning new installations of furnaces and Continuous Casting Machines (CCM) to boost efficiency and product quality. As part of strategic initiatives, we are pursuing ISO 50001 certification for energy management, implementing ESG reporting for transparency, and adopting 5S methodologies to enhance operational efficiency.

How has MSAF adapted over the years, and what have been the most transformative changes of the company?

MSAF's growth from Rs.600 crore to Rs.2,500 crore reflects our commitment to long-term value, strategic relationships, and ambitious goals. In the short term, we aim to exceed industry growth rates and drive innovation. Looking ahead, our plans include expanding into Europe and the UK, and leading in the Green Steel sector, envisioning MSAF as a global leader in financials and sustainability. Overcoming complacency and resistance to change has been a significant challenge. In 2012, MSAF underwent a cultural transformation highlighted by a company-wide survey, leading to a revamped Purpose, Vision, Mission, and Values (PVMV), improved talent management, and setting new industry benchmarks for employee well-being. This transformation spurred substantial growth and earned us our first & 'Great Place to Work' certification, validating the success of our strategic changes.

Can you discuss the connection between MSAF and Maruti Ispat & Energy Pvt Ltd, and how it impacts your operations?

MS Agarwal Foundries is closely connected with MIEPL serving as a crucial subsidiary. This relationship drives strategic alignment, operational efficiency, financial stability, and technological innovation for MSAF.

Are there any new initiatives that MSAF is excited about in the near future?

MSAF is dedicated to achieving internal process excellence through several key initiatives. We are investing in green steel projects to cut carbon emissions and improve energy efficiency. Strategic acquisitions are enhancing our production capacity and technology integration. New technologies are modernizing our production. Additionally, we are committed to sourcing 100% of our power from renewable sources and investing in wind and solar projects.