Industrial Development Bank of India (IDBI) has sanctioned a Rs 605-crore rupee term loan to Tata Iron and Steel Company (Tisco) for partly fund its proposed 1.36-million-tonne per annum cold rolling mill at Gopalpur in Orissa.
The loan carries interest rate of two per cent above minimum lending rate (MLR) plus interest tax. Tisco will also have to pay an upfront of 1.05 per cent of the term-loan payable on signing the loan agreement.
Tisco plans to produce 0.89 million tonne per annum of cold rolled annealed coils and 0.44 million tonne per annum of galvanised plain coils at its Gopalpur facility.
The IDBI loan is to be repaid in 24 quarterly instalments commencing from April 1 2001 after moratorium of six quarters from the start of commercial production.
The cold rolling mill complex is estimated to cost Rs 2,240 crore and is proposed to be financed through internal generation of Rs 1,120 crore, rupee term-loan of Rs 605 crore, internal accruals of Rs 1,120 crore rupee loan of Rs 605 crore and external commercial borrowings of $143 million equivalent to about Rs 515 crore. The unit is expected to start commercial production by October 1999.
The CRM project is being proposed to be set up with technical assistance from Nippon Steel Corporation of Japan. Initially, the company would be sourcing its entire hot-rolled coil requirement for the unit from its Jamshedpur plant. Subsequently, the cold rolling mill will be part of the proposed integrated plant that Tisco is planning at Gopalpur.
The company proposes to set up a hot rolling mill facility at Gopalpur with an initial capacity of 2.5 million tonne per annum.
