JSL to finalise plan to nearly double capacity at Jajpur plant

By: |
January 30, 2021 4:50 AM

“Currently, the Jajpur plant has 1.1 mtpa capacity. We will start working on the expansion sometime this year to increase the capacity to two mtpa in three years,” JSL’s managing director Abhyuday Jindal said.

At present, demand for stainless steel is “very good”, Jindal said, adding that the future also holds bright for the segment.At present, demand for stainless steel is “very good”, Jindal said, adding that the future also holds bright for the segment.

Jindal Stainless (JSL) is in advanced stages of finalising a plan to nearly double its Jajpur, Odisha plant capacity to two million tonnes per annum (mtpa) in three years with an investment of Rs 2,000-3,000 crore.

“Currently, the Jajpur plant has 1.1 mtpa capacity. We will start working on the expansion sometime this year to increase the capacity to two mtpa in three years,” JSL’s managing director Abhyuday Jindal said.

Snugly positioned with less than one debt-equity ratio, JSL will mostly use internal accruals to fund the proposed expansion.

The existing location is equipped to hold further expansion up to 3.2 mtpa, but the company will take a call on enhancing capacity to the potential after stabilising the first phase of expansion and assessing the demand potential at that point of time.

At present, demand for stainless steel is “very good”, Jindal said, adding that the future also holds bright for the segment.

JSL has also one manufacturing plant at Hisar in Haryana with a capacity of 0.8 mtpa. Recently, JSL has announced its plan to merge the Hisar unit with self. Once that happens, the combined entity will be among the top ten stainless steel makers in the world.

The merged entity is likely to end the current fiscal with a total debt of around Rs 3,500 crore, but will have very little repayment obligation in 2021-2022 fiscal.

“While our target would remain to pay off the debt much ahead of schedule, the capex plan will not come at the cost of high leveraging,” said company’s chief financial officer Anurag Mantri said.

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