Delhi-based Bhushan Steel Ltd has proposed to set up a value-added steel plant near Chennai with an initial capacity of 5,00,000 tonne per annum. The company is in talks with the state government to identify necessary land for the project.
When contacted, Nitin Johari, whole-time director (finance), Bhushan Steel said: ?We are planning to manufacture value-added products such as cold rolling, coated tubes, galvanised steel products catering to the automotive sector in the southern region.?
?We are in talks with SIPCOT (State Industrial Promotion Corporation of Tamil Nadu) authorities to identify 60 to 100 acres of land for the same on the Bangalore Highway (beyond Sriperumbudur). We are waiting for the SIPCOT response,? he said.
He said: ?We are planning an initial investment of Rs 500 crore which will be scaled up further in phases. Once we get the necessary land, we expect to complete the project in two years.?
The company will part finance the project from internal accruals with the remaining raised as debt. ?The project will create 800 to 1,000 jobs initially,? he added.
According to Johari, the raw materials for this forward integration plant will be sourced from company?s plants in eastern region. The company has lined up major expansion-cum-backward integration projects in Orissa, West Bengal and Jharkhand which are estimated to cost Rs 26,000 crore, he said. Chennai being the hub for automotive activities, the company proposes to set up a value-added steel plant, he added.
In response to a query on the soaring steel prices, he said: ?The prices continue to firm in the months to come. There is a huge demand for steel from across the country. With the prices of key raw materials such as iron ore and coke oven continue to be on the higher side in the overseas markets one cannot expect the prices to come down overnight. No one wants extra-ordinary profit.?