BL reported that public sector KIOCL is on a turnaround path with the company wiping out its losses and posting a profit for the last fiscal.
It has also lined up a slew of new projects, which includes acquisition of a sick steel product company.
Mr K Ranganath CMD of KIOCL told Business Line that "We have a healthy balance sheet now and have good reserves as well."
KIOCL had incurred a loss of about INR 195 crore during 2009-10 but for the 2010-11 fiscal, it expects to post a profit of INR 85 crore on sales of INR 1,790 crore, which is 80% more than the previous year. The company has reserves of around INR 1,200 crore.
Steel plant
Mr Ranganath said that the process is on for setting up an integrated steel plant in Bellary Hospet region with an investment of INR 7,600 crore. KIOCL which will have a 26% stake in the project, will invest about INR 800 crore as its contribution.
The JV partner is United Telecom's company URISPL. The initial capacity will be 1.5 million tonnes which can be expanded to 5 million tones a year.
KIOCL is also looking at acquiring the sick public sector Tungabhadra Steel Products Limited in north Karnataka but without any liabilities. The public sector undertaking has about 83 acres of land and the infrastructure. KIOCL wants to utilize the land and the facility for setting up a plant for beneficiating low grade iron ore, which is in abundant supply in north Karnataka.
Mr Ranganath said that there is about 200 million tonnes of iron ore tailings at Lakya Dam, which is close to the Kudremukh mines. It can also be used for making tiles or as partial replacement to sand for the construction industry. If commercially exploited, it can generate a direct employment for more than 2,000 people for over 25 years.
He said that around 24 million tonnes of loose weathered iron ore is left in the Kudremukh mines. If left alone, it can flow down to river Bhadra, which can cause environmental damages. The company is seeking the Supreme Court nod to lift the ore so that the environment & ecology of the area can be protected. He added that "The same ore can converted into pellets and it would be enough raw material for three years."
The KIOCL has also put in place necessary facilities for achieving daily 15,000 tonnes of processed ore production and pellets. Even at 85% of capacity utilization, it can produce 3.6 million tonnes of pellets per annum. For 2010-11, KIOCL crossed 2 million tonnes of production and sales of pellets.
(Sourced from www.thehindubusinessline.com)
