Steelmaker plans big
PHP Group moves to expand and diversify, as it plans to make a strong foothold in the country's steel industry. The company has recently acquired a steel mill at Ghorashal, AMK Steels Mill, to produce deformed bar.
“We wanted to expand our steel industry. At present we produce corrugated iron sheet in our PHP Cold Rolling Mills and PHP Continuous Galvanising Mills. Now we are going to make deformed bar in the new mill,” says Zahirul Islam, managing director of PHP Ispat Ltd, a sister concern of the group.
Islam shares his views with The Daily Star on the company's latest move.
AMK Steels Mill that produces thermo mechanical treatment deformed bar was established in 2005. “The company was facing some problems, and those were hard for the company to avoid. So we acquired it for a renovation,” says Islam.
The net asset value of AMK Steels is around Tk 75 crore and the total asset value of the two mills is Tk 1,000 crore.
AMK Steels has been renamed PHP Ispat after acquisition.
PHP Cold Rolling Mills is the first of such mill in the country that started operations in 1999 and PHP Continuous Galvanising Mills started operations in 2001.
These two mills produce nearly 15,000 tonnes of corrugated iron sheet a month, meeting around 40 percent demand of the country. “Our annual turnover from the mills is Tk 2,000 crore.”
PHP Arabian Horse and PHP Arabian Horse Super are the two brands of the company's tins.
The official says they expect an increase in annual turnover by Tk 500 crore with the latest acquisition.
The country needs nearly 17 lakh tonnes of thermo mechanical treatment deformed-bar and 60-grade bar a year, according to Bangladesh Re-rolling Mill Owners' Association.
“We expect to produce one lakh tonnes a year and reach the three-lakh-tonne mark in the second or third year,” Islam says. “We hope to meet about 7 percent of Bangladesh's total demand initially.”
The company exports its PHP Arabian Horse and PHP Arabian Horse Super tins to Europe and Africa. In case of deformed bar, he says the company targets to fulfil the domestic demands at first, as the country still depends on imports.
Islam says steel is one of the important sectors in Bangladesh. “The demand for rod will increase on a regular basis. We are heading to become a developed nation. So we want to produce the best quality rods and fulfil the country's entire demand.”
“If we take initiatives to make best quality products then our competitors will also do so,” Islam says. “This healthy competition will let our people buy quality rods at competitive price.”