Ispat Inds looks at 10 mt steel capacity by 2014

Integrated private sector manufacturer Ispat Industries is planning to raise its steel capacity to 10 million tonne by 2013-14, MD Vinod Mittal said. Ispat currently produces 3.6 million tonne steel a year and it has announced its plans to take its capacity to five million tonne in the next two years.

"We have drawn up plans internally to raise our steel capacity to 10 million tonne, which we expect to meet by 2013-14," Mittal said, on the sidelines of an extraordinary general meeting of the company today.

The company has signed a memorandum of understanding with the Jharkhand government for an integrated steel plant with a capacity of 2.8 million tonne.

"The 10 million tonne capacity will be achieved by increasing the capacity of our Dolvi plant to five million tonne and setting up a new plant in Jharkhand which will initially have a capacity of 2.8 million tonne, expandable to five million tonne later," Mittal said.

Apart from the capacity hike, Ispat Industries' expansion plan involves setting up a one-million-tonne coke oven plant in Dolvi, a 4.5-million-tonne pellet plant in Vishakhapatnam and enhancing the hot-rolled coil capacity of the Dolvi plant from three million tonne to 3.6 million tonne.

"We expect the project to get executed within the next two years," Anil Sureka, CFO, said. Once the projects go on stream, the company's EBITDA margins will double from 17 per cent now, Sureka said.

The work on the green-field project at Jharkhand will start once the company gets iron-ore mines there.