He is an engineer by qualification, has a yen for numbers and holds a postgraduate degree in international trade. Yet, when Sushil Kumar Roongta, chairman, Steel Authority of India (SAIL), began his professional innings, it was as a humble marketing executive in the same company he now heads. This was in 1972, when the licence raj was at its peak and working in a public sector undertaking was considered to be a matter of pride by most middle-class Indians. It ensured a comfortable life and Roongta was no exception to the rule when making the choice of company to work with. He chose a public sector unit to a private company to work with much like his brothers did. ?One of my brothers was the first Indian Administrative Services (IAS) officer from Rajasthan. Two other brothers joined the Indian Railways and Indian Revenues respectively. I couldn?t have stayed behind,? he says.
Being a brilliant student through his school days at Bagar in the Jhunjhunu district of Rajasthan, Roongta did what most bright kids would do ?study for an engineering or medical degree. He opted for engineering at the prestigious Birla Institute of Technology and Science (BITS), Pilani in Rajasthan. Ironically, it was here that he realised that engineering was actually not his cup of tea. ?I loved numbers. I still do,? he says.
He graduated from BITS, Pilani and enrolled for a postgraduate course in international trade at the Indian Institute of Foreign Trade (IIFT), New Delhi. ?I did well during the course and topped my batch,? he says, proud of his achievement there.
Though Roongta made the switch from engineering to foreign trade early on, it was this diverse educational background that stood him in good stead as he made his way to the top of the corporate ladder at the Rs 45,555-crore steel company in his later years. The inevitable struggles were there, like balancing his family along with work. But Roongta persevered. ?I attach a lot of importance to my family. It is as precious to me as my career,? he says.
Which is why he was prepared to give crucial out-station promotions the pass just to be with his family including wife Asha and children Vipul and Ruchika. ?I remember those times when I had the opportunity to take up assignments abroad,? he says. But the love for his family, especially his children held him back.
He has no regrets of declining those lucrative offers, in hind sight. ?I am happy with the way my children have shaped up,? he says. ?That?s important to me. Vipul is an MBA working as a fund manager with a company, while Ruchika is a dentist.?
After 36 years at SAIL, Roongta became its chairman in 2006. ?It?s over 36 years now that I?ve been at SAIL,? he says. Naturally he understands the company, its culture and business thoroughly.
His peers say, ?His ability to number-crunch makes it easy for him to understand finance. He loves the subject. At the same time, his experience in marketing implies that he knows how business development is done and what are the challenges involved thereof.? Says a close aide, ?He has a good theoretical grounding as well as an understanding of the practical side of business. This surely helps.? Says an industry insider, ?The manner in which he has steered the business at SAIL speaks for itself. He?s smart.?
It?s no wonder then that Roongta commands a lot of respect in the steel industry. His views are actively sought when it comes to anything concerning steel. The 58-year-old veteran realises that his marketing and financial acumen has helped him survive the many peaks and troughs of the business. At the moment, for instance, the chairman is grappling with a depression in steel prices on account of the global financial meltdown, which has pulled down commodity prices in general. ?It will take three years before we come back to 2008 price levels,? he says. ?There is an oversupply situation in steel the world over that is pulling down prices.?
But the oversupply has been triggered in part on account of the fall in demand due to the slowdown in developing and developed markets. This is troubling a lot of steel makers who had confidently moved ahead with their expansion plans over the years in the hope that demand for steel would only rise on the back of increased production and consumption. A fall in demand due to a worldwide slowdown triggered by a financial crisis is something that nobody had anticipated, not even SAIL, the largest steel maker in the country with crude steel production of 14 million tonne per annum and saleable steel production of 13 million tonne per annum.
But now that the situation is upon the company, Roongta is evaluating the growth prospects of the firm in the given scenario. ?I am not going slow with the expansion of the company. The situation will ease in time. Demand will bounce back. It already has, for instance, in automobiles.?
But a bounce-back in automobiles is not enough, Roongta knows. Real estate and construction, for instance, which is a large consumer of steel also has to bounce back. Roongta is pinning his hopes on the monetary and fiscal measures undertaken in the recent months to restore consumer confidence. ?The fiscal measures in the stimulus packages were backed by rate cuts by the central bank. It is this combination of bringing down price as well as interest rates that should help increase demand going forward,? he says.
Till that time though SAIL like most other steel and metal companies will have to judiciously manage supply in line with the existing demand. This is telling on company performance. Net profit, for instance, was down by Rs 1,092 crore to Rs 843 crore in the third quarter this year over the same period last year. Turnover, on the other hand, was down by Rs 810 crore to Rs 9,946 crore in the third quarter over the corresponding period last year
Roongta attributes the company performance to not only weak demand but also high input costs such as that of coking coal which hit profitability in the third quarter. Though coking coal prices are now down, he says, that wasn?t the case in 2008 when they went up substantially. ?This impacted profitability, besides, the fall in demand,? he says. Nonetheless, Roongta is not losing sleep over the slide in performance of his company. ?I am an optimist,? he says. ?I don?t give up.? This never-say-die spirit is what is goading him to pursue his 2010-11 vision for the company with gusto. By that time Roongta hopes to take up crude and saleable steel production by 10 million tonne per annum respectively. That is one part.
The other is hot metal production, which is the stage prior to crude steel production using the blast furnace method, where coking coal and iron ore are the raw materials. The company hopes to increase production of hot metal from 15.2 million tonne per annum, currently, s to 26 million tonne per annum by 2011-12. For that, it is putting in place its iron ore and coking coal linkages. The company of course has vast iron ore mines, say analysts, on account of which it may not be so difficult for it to source the raw material even as it expands production. ?Coking coal is something that it imports like most other steel companies since India is deficient in the raw material. So that is the only challenge,? says a steel analyst based in Mumbai.
As he works on putting his 2010-11 vision in place, Roongta has also set his sights on the way forward beyond this period. ?I would like to take hot metal production to 60 million tonne per annum by the year 2020,? he says.
That is an ambitious target he?s set but going by the way he?s steered his company this far, this shouldn?t be so challenging afterall.
