Rashtriya Ispat Nigam Ltd’s – Vizag Steel Plant has a bright future and the state-run company will invest Rs 22,000 crore in the next phase of expansion, according to Chairman and Managing Director A.P. Choudhary.
At present, the plant has the capacity to produce 6.3 million tonnes (mt) a year and 1 mt will be added after upgrading and modernising the existing units.
The target of achieving 20 mt production is not an unrealistic one, Choudhury, who’s retiring by the month-end, told
“Further, we will undertake the next phase of expansion to increase the capacity by 4 mt with an investment of Rs 22,000 crore after listing the company.
“The listing, which has been put on hold due to uncertain market conditions, is likely to be taken up during the next fiscal,” he said.
The Government is planning to offload a 10 per cent stake in the company.
Choudhary said RINL had recently completed the 6.3-mt expansion at a cost of Rs 12,300 crore through internal accruals alone. Repair work at the two blast furnaces is in progress, he added.
The consultant for the next phase of expansion, M.N. Dastur and Co, has already submitted the feasibility report.
Next phase In the next phase, the company will foray into flat products.
“At present, we are focusing on the right product mix and value addition,” said the chairman.
Multi-unit company Choudhary further said RINL became a multi-unit company during his tenure and it is a matter of great satisfaction for him.
The investment of Rs 1,000 crore on a forged wheel factory at Rae Bareli in Uttar Pradesh and Rs 300 crore rail on an axle plant near New Jaipalguri in West Bengal will strengthen RINL in those States, he added.
He said the company, which suffered for want of captive iron ore mines in the past, has made considerable headway in securing iron ore.
An agreement with Andhra Pradesh Mineral Development Corp (APMDC) will be signed shortly for exploration of iron ore at Bayyaram in Khammam district of the State.
Vizag Steel Plant has already signed an MoU with APMDC and Kudremukh Iron Ore Co Ltd for sourcing 50 per cent of iron ore mined in Anantapur district of AP.
Awaiting clearance The Rajasthan Government had granted an iron ore mine at Bhilwara with 260 mt of reserves.
The steel plant is awaiting clearance from the Union Ministry of Mines for another mining lease at Jahazpur in the same State, where the reserves were estimated to be 400 mt.
“There should not be any problem for expansion of the plant's capacity in future,” Choudhary added.