Tata Steel, Nippon to ink Rs 2,400-cr JV by Jan-end

Tata Steel plans to ink an agreement with Japan-based Nippon Steel Corporation by the end of this month. It plans to set up a Rs 2,400-crore plant for producing auto-grade steel.

The proposed joint venture (JV) facility is expected to commence operations in the next two years at Tata Steel’s existing unit in Jamshedpur.

“The JV with Nippon will be signed by the end of January. We expect to start production by early 2013,” said Tata Steel Managing Director H M Nerurkar.

With a 50:50 holding ratio, the JV would come up at an investment of Rs 2,400-crore. The facility’s initial capacity would be 0.6 million tonne a year, Nerurkar said.

It aims to capture the growing demand for high-tensile auto-grade steel in India. Nippon, the world’s second largest steel maker, will transfer its technology for producing auto-grade steel.

“The demand for small cars in India is rapidly growing and we aim to tap this growing market,” Nerurkar said.

Global automajors like Honda, General Motors and Hyundai Motors currently import steel for making cars.

“We hope the new facility will cater to the demand of the growing automobile industry in India,” he said.