December 02, 2008

JSW targets 30 million tonnes per annum steel by 2020

It is reported that JSW Steel has targeted to produce 30 million tonnes per annum steel by 2020 and has charted out its expansion plan to achieve it. Currently, the Bellary unit in Vijaynagar in Karnataka produces 3.8 million tonnes per annum and is planning to expand it to 10 million tonnes per annum by 2010 in 2 phases.

Mr Seshagiri Rao MVS director finance of JSW Steel said that "In phase I we will expand from 3.8 million tonnes per annum to 6.8 million tonnes per annum by March 2009. In phase II, which will be complete by September 2010, the capacity will be hiked from 6.8 million tonnes per annum to 10 million tonnes per annum."

He added that JSW Steel mainly produces flat steel products of all grades. In the galvanising product segment, it has 14% market share while in hot roll coil about 12% and is planning to capture 15% overall market share by 2010.

JSW Steel is also planning to introduce long steel products in the market. After the expansion it will produce of 1.5 million tonnes per annum long steel products and 8.5 million tonnes per annum flat steel products. Besides the brownfield expansion at the Bellary unit, it is also setting up 2 Greenfield units, 1 in Jharkhand and the other in West Bengal.

Mr Rao said that "Preliminary work is in progress in both the locations. We are acquiring land, tying for raw material linkages and shifting utilities. It will take at least a year to start construction on the plants. In West Bengal, JSW will produce 3 million tonnes per annum in phase I and expand in 2 more phases. Similarly, in Jharkhand, the project will be implemented in phases. We have estimated the project to cost INR 3,000 crore per million tonne. The debt to equity ratio will be 1:1. We are planning to raise funds from international and local markets for the expansion."