JSW Steel will commission the first phase of its new 2.3 million tonnes plant, which will produce high-grade automotive steel, by September this year.
NEW DELHI: JSW Steel will commission the first phase of its new 2.3 million tonnes plant, which will produce high-grade automotive steel, by September this year, a top company official said.
The new plant is envisaged to get Rs 4,025 crore investment and is being developed in technical collaboration with Japan's JFE Steel Corporation -- the second largest shareholder of JSW.
"They (JFE) have given us that technology for automotive steel. That plant is coming up in operation in second half of this year, by September," JSW Steel's Joint Managing Director Seshagiri Rao MVS told PTI.
He added that "out of 2.3 million tonnes (proposed capacity), we are commissioning phase-I of 1 million tonnes in September. The second phase will come in next year at the same time."
In January 2011, the company had announced it will set up a new 2.3 million tonnes per annum (MTPA) cold rolling mill complex while targeting increase in its share in niche market segments like automotive steel, which is used in making body parts of cars and SUVs.
The new capacity will help JSW in meeting the demand of automobile industry for high end products like dual-phase steel and strip steel as well.
Currently, most of the demand for such products is met through imports as there is not enough domestic manufacturing capacity. According to industry estimates, annual domestic demand of automotive steel is around 8-10 million tonnes.
As per the company, the under construction complex will have 2.3 MTPA of pickling cum coupled tandem cold rolling mill, 1.9 MTPA (two lines of 0.95 MTPA each) continuous annealing lines and 0.4 MTPA galvanising-cum-galvannealing line.
The project is being funded with a debt to equity ratio of 2:1. This means that out of Rs 4,025 crore investment, company has taken Rs 2,675 crore debt and is meeting rest of the investments, at Rs 1,350 crore, through internal accruals.
JSW Steel currently has a 10 MTPA capacity at Karnataka's Vijaynagar and 1 MTPA capacity at Tamil Nadu's Salem. JSW Ispat's merger into the company, which was announced in September last year, is awaiting approval of the Bombay High Court.