New Delhi, 20 June : Globally, the slowdown in the economy seems to be falling in the aluminium industry. Aluminium prices on the London Metal Exchange (LME) have been showing a steady decline. This is also affecting the business of Vedanta Group’s Bharat Aluminium Company Limited (BALCO). So the management is moving towards taking some tough decisions. In this context, Abhijit Pati, Chief Executive Officer and Director of BALCO, has circulated the message to the officers and employees through e-mail. View message:
“As we read the global markets, which are now heading to recessions and slowdowns, would further lead to price cuts for sustenance.
In the Aluminium business, we are facing an unprecedented situation over the past few months wherein the LME prices have dropped by more than > USD 800 per Ton & currently hovering around USD 2400 per Ton. Further, the cost structure of the business is still very high compared to the market drop of LME, majorly due to Internal Inefficiencies, delayed executions of project, availability of critical raw materials, and Lack of path-breaking ideas. In these testing times, we are negative cash-generating thus adding more pressure to the business.
We as a team are challenged to stay afloat and remain competitive in these testing times. As the LME falls, we are incurring massive losses and piling on the debts
In these times the only way to sustain the business will be to continuously reduce cost, improve internal efficiencies, innovate, avoid and further cut off avoidable spending. We believe that as a team we can deliver in these tough situations. We have to further reduce our cost from the current USD 3200 per Ton (All in cost) to USD 1500 per Ton so that we can stay competitive.
It is imperative that at this hour, we all come together to brainstorm ideas and initiatives to cut down the cost and generate cash flows for the survival of BALCO. I appeal to each and every employee to significantly reduce expenses and stop all non-critical and extra spending. We need to reduce substantially the expenditure in every activity. This is a time when all of us should put our austerity measures in every sphere of our activity. Please remember, together with our best effort and positive mindset we can survive BALCO.
This is one journey that will make BALCO, truly a world-class leader and we as a team will deliver stellar performance.”
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