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| Last Updated:22/08/2019

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Vedanta eyes 10MT steel output in 6 yrs via ESL

 

Kolkata | June 27, 2019: Vedanta Group is eyeing 10-million-tonne (MT) capacity in steel in the next five-six years through Electrosteel Steels (ESL), which the Anil Agarwal-led group acquired through the National Company Law Tribunal (NCLT) last year. This had also marked the entry of non-ferrous metal czar Anil Agarwal into steel. The group is also planning to rename the company in the next three-six months with the Vedanta tag. This would include brownfield expansion in existing location near Bokaro and greenfield expansion in a new location that could include West Bengal as well.

 

The deputy CEO of ESL, Pankaj Malhan, told reporters here that the group wants to be among top three-four in steel business in future. Malhan was here for the introduction of re-branded steel products of the company. As per the earlier plan, Vedanta is doubling the capacity of ESL to three million tonne in Phase I from the current level of 1.5MT. There will be expansion as well as debottlenecking of capacity.

 

Malhan added that total investment in the first phase could be Rs 4,000-5,000 crore. After completing Phase I, it may commence on Phase II, where the capacity would go up to six million tonne in the existing location.

 

However, for further expansion of the group capacity to 10MT it would look for a green field project in Bengal or in South India. “We shall appoint a consultant for the greenfield project,” he added. However, he did not disclose the investment figures for second phase and greenfield expansion.

 

Commenting on name change, he added that the company board will take a call in this regard in next few months. “We are rebranding the products so name, too, would be changed,” he added.

 

Maldan claimed that under Vedanta, ESL has already made a turnaround in eight months. The EBIDTA of the company has grown 152% while operating profit growth was 120% year-on-year. It is also hoping a profit after tax to the tune of close to Rs 300 crore in the current fiscal. It is also expecting to repay 20% of its debt overhung of Rs 2,500 crore in the current fiscal. “This year we shall repay Rs 500 crore,” he added.

 

The deputy CEO also indicated that the company would bid for mines in Jharkhand and Odisha whose mining lease is expiring next year.

 

Elaborating on expansion, he added the first phase of expansion will be for long product but in the second phase, it would be for flat products.

 

Currently, ESL has a sinter plant, coke oven, blast furnace, basic oxygen furnace, billet caster, wire rod mill.

 

 

(Source: https://timesofindia.indiatimes.com/)