Ispat to invest Rs10,000 crore in next five years

Ispat to invest Rs10,000 crore in next five years
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First Published: Tue, Aug 14 2007. 04 56 PM IST
Updated: Tue, Aug 14 2007. 04 56 PM IST
PTI
Mumbai: After the Tata and Essar, another domestic steelmaker, Ispat, is expanding overseas through capacity expansion and backward integration. The steel major has plans to invest Rs10,000 crore within five years to ramp up its domestic production.
“Ispat Industries Limited (IIL) and its parent company Global Steel Holdings are working on plans to expand operations both in India and overseas. We would be ramping up our production at Dolvi plant near here from 3 MT to 3.6 MT per annum,” IIL executive director, finance, Anil Surekha told PTI.
He said the company’s domestic expansion plans include building a one million tonne per annum (MTPA) coke oven plant and 4.5 MTPA coke pellet plant (likely in Visakhapattanam).
“Rs3,000 crore would be required for ramping up Dolvi plant’s capacity from 3.6 MT to 5 MT by 2011-12,” he said.
Surekha said IIL’s proposed 2.8 MT plant in Jharkhand would require an investment of about Rs 5,750 crore, but fructification of the project would depend on availability of iron ore through captive mines which was indicated to the company by the state government in an MoU.
“IIL’s parent company Global Steel Holdings is exploring the possibility of projects in the overseas for capacity expansion and backward integration to ensure a perennial source of raw materials and strike a business synergy in various parts of the world,” he said.
Currently, Global Steel manages steel capacities totalling 14 MT in Bulgaria, Philippines, Kosovo, Nigeria and Libya, besides India. The company also operates coal and coke processing units, iron ore mining, refractories, steel rolling mills and ferro-alloys mills in Serbia, Montenegro, Nigeria and India.
Citing that raw material security was crucial for the company’s expansion plans, Surekha said IIL’s bottomline was taking a hit due to procurement of iron ore and coal from open market.
“While those having captive source of raw materials enjoy a certain degree of comfort, we are compelled to source the same from the market at prevailing prices, which is hitting our bottomline,” he said.
Global Steel has reportedly submitted a proposal of assorted projects worth $5 billion in Bangladesh while the Tata Group has submitted project proposals of $3 billion, but the fate of the projects is still undecided.
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First Published: Tue, Aug 14 2007. 04 56 PM IST