As a result of this, Jindal said the financial year 1999-2000 ended on an encouraging note with sales aggregating approximately Rs 1,000 crore. The company, however, will be incurring a cash loss of Rs 25 crore for the fiscal and a net loss of approximately Rs 110 crore. The interest cost for the fiscal was roughly Rs 200 crore and the company managed to service around Rs 175 crore of the interest burden. JVSL produced 406,723 tonnes of hot metal and 608,700 tonnes of HR coil in 1999-2000. The corex unit, which has rated capacity of 100 tonnes per day, produced an average of 91 tonnes per day during the year and achieved a peak production of 120 tpd in March 2000.

For the fiscal 2000-01, Jindal is more optimistic of the company's performance on the back of a strong performance in March. He says that with the improving domestic and international steel scenario and better price realisation, JVSL is targeting to double its sales to Rs 2,000 crore. Jindal told The Financial Express that he conservatively estimates the company to make a cash profit of Rs 300 crore and a net profit of Rs 82 crore in 2000-01. The interest burden to JVSL in 2000-01 is expected to be Rs 489 crore and depreciation Rs 223 crore.

As of today, JVSL has one corex module in operation with a rated capacity of 800,000 tonnes. Jindal expects this module to produce 840,000 tonnes of hot metal in 2000-01. Joint managing director and CEO JK Tandon is a little more optimistic and says that they target to produce one million tonne of hot metal in the current fiscal. The targeted production of hot rolled coils is 1.05 million tonnes.

JVSL's second corex unit of similar capacity is expected to installed by December 2000 and commercial production is expected to start only in April 2001. The second casting mill and basic oxygen furnace have already been supplied and installation will be completed during the fiscal year. The three million tonne per annum pelletisation plant is also expected to be commissioned by September 2000.

According to Jindal, the major advantages of JVSL over other integrated steel plants are its low costs, proximity to the market and its environment friendly technology. Today JVSL is using as its feed 40 to 50 per cent lump ore from Bellary Hospet region, 10 per cent fines and 50 per cent pellets which it sources locally or imports. The cost of pellets today is approximately Rs 2,200 per tonne.

Once the pelletisation plant is commissioned, the cost of pellets would be Rs 600 per tonne which works out to Rs 900 per tonne of hot metal produced. The company is also integrating backwards into mining with a joint venture with Mysore Minerals. The mining venture will have a capacity to produce three million tonnes of iron ore for pelletisation. This is expected to be commissioned by September 2000 along with the pelletisation plant. According to Jindal, this will be lowest acquisition cost of iron ore in the industry.

The other significant advantage is the power plant which will use gases from the corex unit to generate power. The power plant has a capacity of 260 mw and is fully operational. As of now, one unit of 130 mw uses gases from the corex module and the other uses coal fines which cannot be used by the corex module. Once the second corex module commissions, it will supply gases to the second power unit.