New JSW steel plant at Bellary to start by December

HYDERABAD: The upcoming 2.3 million tonnes plant of JSW Steel which will produce high-grade automotive steel, will operationalise by December this year in Bellary, company's CMD Sajjan Jindal said today.

"Our new plant which is designed specifically for the auto-industry is coming up by the end of this year (in Bellary, Karnataka)," Jindal told reporters on the sidelines of a function at ICRISAT on the city outskirts.

The company has invested about USD 1 billion for the plant, he said.

"...The project is already funded. By December it will be completed. It's a 2.3 million steel plant. It will generate about USD 2 billion of revenue once it attains full capacity. First year we expect the revenue generation will be USD 1 billion," Jindal said.

On if the company had talks with automotive customers, Jindal said, "We are already in talks with all the auto majors and most of them have approved the product quality."

"This (upcoming plant) is for all the steel for the car body. Skin panels are being imported (and once the plant is commissioned) they don't have to import anymore and it will be 100 per cent indigenous steel," he said.

Japanese steel major JFE Steel is the technology partner for producing the auto-grade steel, he said.

When asked if they were looking for exports from the proposed plant, he said it will be at a later stage.

"Right now India imports all the steel for auto-grade. We will be substituting the imports," Jindal said.

In January 2011, the company had announced it will set up a new 2.3 million tonnes per annum (MTPA) cold rolling mill complex while targeting increase in its share in niche market segments like automotive steel, which is used in making body parts of cars and SUVs.

The new capacity will help JSW in meeting the demand of automobile industry for high end products like dual-phase steel and strip steel as well.

Currently, most of the demand for such products is met through imports as there is not enough domestic manufacturing capacity.

According to industry estimates, the annual domestic demand of automotive steel is around 8-10 million tonnes.