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| mjunction aims to treble business by 2012 |
| Press Trust of India / New Delhi Mar 11, 2010, 13:24 IST |
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The e-commerce joint venture between SAIL and Tata Steel, mjunction, today said its value of transactions may treble to Rs 50,000 crore by 2012-13 as on-line trade is gaining momentum in India.
"We aim to clock transactions worth Rs 50,000 crore by 2012-13. We hope to complete the current financial year with transactions of about Rs 20,000 crore," mjunction Managing Director & CEO Viresh Oberoi said.
The company, which is evenly owned by the steel majors, recorded a transaction value of Rs 14,393 crore in the last financial year.
The company hopes 90 per cent of the total transactions would come from its steel and coal trading business and the rest from the business-to-consumer segment.
Keen on growing overseas, mjunction is building a war chest of about Rs 100 crore for acquisitions in the procurement space, especially in Europe and America.
At present, it has facilitated business transactions in South East Asian nations like Thailand.
"We are planning to create a warchest of Rs 100 crore for acquisitions which will be made in the next fiscal. This will come from the promoters and our internal accruals. We are now evaluating merchant bankers who can seal such deals for us," he added.
Asked if the company is planning to hit the capital market to raise funds, Oberoi said, "Our promoters have told us that they will meet our funding requirements and as for now there is no need to go for an initial public offer."
About two years ago, a Washington-based private equity firm valued mjunction at Rs 600 crore and had evinced interest for 20 per cent stake in the firm for about Rs 120 crore.
When asked if mjunction will benefit from the expected rise in steel, coal and iron ore prices, Oberoi said, "mjunction's role becomes prominent during price volatility in the rates of such products."
However, he maintained there will be a pressure on steel manufacturers to increases prices.
"Our aim is to bring in transparency and innovation in the domestic supply-chain, which is inefficient and opaque," he added.
Steel manufacturers are set to clinch next fiscal's contract for supply of raw material like iron ore and coking coal with mining entities.
Coking coal contracts are expected to be at $200 a tonne against the current fiscal's $105 a tonne. Iron ore prices are also ruling high at around $100 a tonne.
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