Mesco plans Rs 13,500 cr investment to raise capacity in 3-5 yrs

The $4 bn group recently signed an deal with South Korea's Posco for shifting the latter's patented Finex plant to India

Private steelmaker Mesco plans to take its capacity to 4.5 million tonnes (MT) in the next 3-5 years with an investment of Rs 13,500 crore.

"We will take MESCO Steel's capacity to 4.5 MT in the next three to five years from the present about 2 MT. We will be investing about Rs 13,500 crore for this brownfield expansion," Mesco Steel Director Finance Natasha Singh Sinha said here.

Mesco Steel through its arm Mideast Integrated Steels Ltd (MISL) had set up a steel plant of 1.2 MT per annum (MTPA) capacity in Kalinga Nagar, Odisha.

 

Also, in April this year, it acquired Maithan Ispat for Rs 1,160 crore in a mix of debt and equity deal.

"Capacity of MISL steel plant in Jajpur will be raised to 3.5 MTPA from the existing capacity of 1.2 MTPA, while 1 MTPA capacity will be achieved at recently acquired Maithan Ispat," Sinha said.

Post-acquisition of Maithan Ispat, MESCO Steel has added capabilities to produce sponge iron, billets and heavy beams.

"The process for modernisation and expansion of Maithon Ispat has been initiated and the first phase of expansion envisaging investment of Rs 300 crore is being taken presently and funds have already been tied up," she added.

"Presently finances for expansion at MISL are being raised. For this phase of expansion, Rs 3,500 crore are being arranged. Major revamp of both the last furnaces has been completed."



Speaking on expansion plans for Maithan Ispat, Sinha said two electric arc furnaces of 50 tonne each would be set up replacing existing induction furnaces. Also, capacity of existing power plant of 30 MW will be raised to 90 MW and a rolling mill for TMT bars would be commissioned.

She added that Maithan has a heavy section mill with existing capacity of 0.8 MTPA which is expandable to 1 MTPA

The $4 billion group recently signed an agreement with South Korean steel giant Posco for shifting the latter's patented Finex plant to India.

Mesco also operates an iron ore mine in Barbil region and has another (iron ore) mining on lease at Malangtoli in Odisha.