JSW Steel plans Rs 7K cr expansion

MUMBAI: The Sajjan Jindal-promoted JSW Steel on Friday kicked off its expansion project that will see the company’s capacity increase to 10 million tonnes by 2010. At present, JSW Steel produces 3.8 million tonnes, which will increase to 6.8 million tonnes by August next year.

The completion of the project will make the Bellary-based, $2.2-billion JSW Steel the largest single-location steel production facility in the country, the company said in a statement issued on Friday. At present, it is the third-largest private steel manufacturer in the country, behind Tata Steel and Essar Steel.

The company, part of the $4.6-billion OP Jindal group, will invest Rs 7,000 crore in its expansion project. The debt-equity ratio, though, could not be ascertained. The company is building two blast furnaces for the 10-million-tonne expansion. The company claims that their furnaces will be the biggest in the country.

Shares of JSW Steel rose 5.1% to Rs 722.70 on the Bombay Stock Exchange on Friday. The metal index, spurred by reports about an alliance between ArcelorMittal and Nippon Steel, was also up 4.5%.

Explaining the need for expanding steel capacity, JSW Steel vice-chairman and managing director Sajjan Jindal said: “India’s thrust on infrastructure development will continue to drive the demand for steel in the coming years. The growing fixed-asset investments in the emerging economies will see a growing demand for steel.”

On Friday, JSW Steel also announced plans to set up a vocational training centre at a cost of Rs 7 crore. The company will take over three Industrial Technical Institutes at Vittalapura, Hospet and Kudligi in Karnataka. It is joining hands with the “government to give a fillip to technical education,” said the statement from JSW Steel.