Topline Securities organised the Pakistan Mid Cap Conference 2025. The second session of Day 2 focused on International Steels Limited (ISL), featuring Mr. Samir Chinoy, the CEO of ISL, as the key speaker.
The market size for galvanised, colour-coated, and cold-rolled coil (CRC) steel in Pakistan is approximately 1 million tons. Listed players, International Steels and Aisha Steels, fulfill 60% of the demand, while imports meet the remaining 40%.
In FY24, ISL’s sales volume was 264,000 tons, a decline from over 400,000 tons achieved in FY22. The decreased volumes can be attributed to a reduction in the overall market size and a loss of market share to imports, primarily due to dumping from FATA/PATA and circumvention of duties.
According to management, the domestic flat steel market grew by 18% in FY25; however, the listed sector has not fully benefited due to issues of dumping and duty circumvention. Duty circumvention is primarily occurring through Galvalume, a substitute for galvanised steel, which currently has no anti-dumping duties.
ISL management has submitted an application to the National Tariff Commission for the imposition of anti-dumping duties on Galvalume, with a positive outcome expected before June 30, 2025. The import volume of Galvalume currently stands at 220,000 tons, and management anticipates that at least 150,000 tons will shift to the listed sector following the imposition of duties.
Additional volumes are also expected due to the proposed increase in sales tax in the FATA/PATA region. Currently, there is a price difference of Rs30,000 per ton between the formal and informal sector flat steel, which is expected to decrease to Rs15,000-18,000 per ton, thereby enhancing the competitiveness of the formal sector.
ISL has also filed for anti-circumvention measures against specific types of CRC, with results anticipated in nine months. At present, hot-rolled coil (HRC), which is the primary raw material for the company, is subject to a regulatory duty (RD) of 5% and an additional customs duty (ACD) of 2%. The removal of the 5% RD in the FY26 budget could potentially increase the company’s margins by 5%.
The USA is the largest export market for ISL. Due to the US government imposing anti-dumping duties on various countries, including Vietnam, ISL products have become more competitive, and the company aims to boost its exports.
ISL has obtained certifications to export to Europe, Saudi Arabia, Malaysia, and other regions, allowing it to target exports in these markets. Additionally, the company is expanding its solar capacity by 6.4 MW, which will decrease reliance on the grid and captive gas. Solar energy is expected to contribute 11% of the company’s power requirements in FY26.
Moreover, ISL continues to innovate and has recently launched new products, including electrical steel.
