Srikalahasthi Pipes, which produces ductile iron pipes mainly used for transporting water, is seeking partners to form a joint venture that would use the “surplus liquid metal” that the company’s manufacturing plant leaves it with.
Srikalahasthi Pipes, which was until recently known as Lanco Industries Ltd, melts iron ore in its blast furnace to produce pig iron, the raw material for ductile iron pipes. The process leaves it with 100 tonnes-per-day of surplus liquid metal. The company is putting through an expansion programme with an investment of Rs 425 crore which will raise its capacity by 50,000 tonnes annually from 225,000 tonnes now. After this expansion, the plant will have 300 tpd of surplus liquid metal.
And, there is a 100-acre spare land parcel at the company’s unit at Srikalahasthi, Andhra Pradesh, near the Tamil Nadu border. The idea is therefore to form a joint venture that will make use of the liquid metal to produce castings.
Gauri Shankar Rathi, Director, Srikalahasthi Pipes, told BusinessLine today that the company is in talks with a few leading industrial houses and though nothing has been finalised as yet, an announcement could be expected in the not too distant future.
Lanco Industries was set up by the Lanco group, but was later bought by the Electrosteel group of Kolkata. The company changed its name to Srikalahasthi Pipes a few months ago. Its turnover crossed the Rs 1,000-crore mark for the first time in 2013-14.
For the nine months ended December 2014, it reported net profit of Rs 52 crore, up from Rs 22 crore in the corresponding period of the previous year.
On the NSE on Friday, the SRIPIPES share closed at Rs 90.