Rama Steel Tubes increases capacity of Khopoli plant by 36,000 MT

Rama Steel Tubes Ltd, a manufacturer of ERW steel tubes, has increased capacity of its Khopoli (Maharashtra) plant to 72,000 metric tonne (MT) by commencing commercial production of its second production line, adding an additional of 36,000 MT. The company is also planning to further add a third production line of additional 60,000 MT capacity by Q1FY18, taking the total capacity to 132,000 MT.

The manufacturing unit at Khopoli has been the first venture of Rama Steel outside of North India; it has a manufacturing facility at Sahibabad (Uttar Pradesh). The first production line at Khopoli started production in June 2015 with a capacity of 36,000 MT. The production achieved in the first nine months of operations ending FY2016 was 22,000 MT resulting in over 80 percent utilisation. While the total capex for first production line was Rs 7 crore, the company has invested Rs 5 crore in the second production line having an installed capacity of 36,000 MT. 

Naresh Kumar Bansal, managing director, Rama Steel Tubes, said, “With the commencement of the second unit at our plant in Khopoli, we are looking at moving up the value chain of products, which we currently offer and cater to the high growing markets in the West. We have been able to set up manufacturing units at the lowest possible costs in the least possible time. These units will enable us to cater to higher demand in terms of both sizes of pipes and variety of products.”

The Khopoli plant is very strategically located, servicing the key high growing markets of Maharashtra, South Gujarat, North Karnataka and Madhya Pradesh. These units offer an increased range of diverse and value added products (such as pre-galvanised tubes) and enable Rama Steel Tubes to bring down the logistics cost, positively impacting realisations and profitability.

“Maharashtra and Gujarat are one of the fastest growing markets in India. However even today, around 25-30 percent of their pipes requirement comes from other ports of the country. In fact, we have been servicing these markets from our plants in Delhi. This strategic decision of setting up the plant in Maharashtra has enabled us to bring down our logistics costs and supply faster, bringing in operational efficiencies and achieve better profitability and higher return ratios,” added Bansal.

Incorporated in 1974, Rama Steel Tubes manufactures a wide range of steel tubes to cater to diverse applications in sectors such as automobile, infrastructure, real estate and furniture among others.