Says Gopal Agarwall ,Managing director of Mahalaxmi Vinimay,”Steel is the future”.I anticipate that in the next five to ten years ,TMT bars will no longer be made out of iron.We are pioneering the transition from iron based TMT,S to steel bars fot constructions sector,however Agarwall cautions,”The transitions will not be easy.Acceptance will be slow ,We ,being the pioneer now in stainless steel TMT bar,will have to take the responsibility to communicate to the users about the benefits and advantage of stainless bars for building houses.”.

Mahalaxmi plans to keep the stainless bar prices close to the current iron TMT bars .With initials volumes expected to remain low,the company has to subside the product to a large extent.Says Gopal Agarwal. We have to keep the price parity between iron ropads and the new stainless rods to make the products acceptable to the masses at large

For the interim period when the volumes are low ,it will be a huge challenge to meet the manufacturing expenses of the stainless bar and still keep costs low. But eventually as the product acceptance grows and volumes pick up,stainless steel bars even at the cost of iron would be a profitable product for us.

Now theres an interesting catch in how Mahalaxmi strategies to offset the initial loss.One of the major components of TNT bars consumer pricing freight . The product being exceotionally heavy,freight charges plays an significant role in the daily price flactuations of TMT bars .

According to Gopal Agarwall ,the stainless bars shall be 40% less in weight than the current iron bars and also consumes lesser space therby directly reducing the freight cost. But even when the stainless bars are low weight it has the same strength of iron bars.

Mahalaxmi products communication will be around theUSP that iron bars maunufacturers are misleading the consumers by saying that they are rust proof,hence breakage proof and also earthquake proof.Any iron,will eventually succumb to rust and thus cannot be earthquale resistant.

Steel,on the contrast is intrinsically rust proof metal.Steel bars are the best earthquake resistants, Once consumers understand the vital difference between iron and steel ,the market will switch rapidly towards steel bars,Says Gopal Agarwall.

Mahalaxmi has all set to invest an additional Rs 50 crore to upgrade itsfacility to manufacture the new generation stainless Bars . The company shall plough back half the investement from internal reserves and source the rest of the fund from financial institutons.