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Tuesday, Jun 22, 2004

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Corporate - New Projects


VSP plans Rs 3,000-cr capacity expansion

Our Bureau


Mr B.K Panda, Chairman and Managing Director,Vizag Steel, at a press conference in Chennai on Sunday. — Shaiu John

Chennai , June 21

VISAKHAPATAM Steel Plant (Rashtriya Ispat Nigam Ltd) plans Rs 3,000-crore expansion of its capacity to five million tonnes (m.t.) by 2008, from the present 3.5 m.t., according to the Chairman-cum-Managing Director, Mr B.K. Panda.

He told presspersons that besides Rs 2,400 crore from the company's internal accruals, the BOT (build, operate and transfer) operator would fund the remaining Rs 600 crore.

The company would further expand its plant capacity to 10 m.t. by 2018 at a cost of Rs 17,000 crore. This would be funded entirely from internal accruals.

It is also looking for technology partners in Italy, Austria or Germany.

VSP supplies products to a number of Indian companies, including Wheels India, Mahindra & Mahindra and Telco. Around 10-12 per cent of the company's products are exported, mainly to the US.

Mr Panda said VSP was referred to the Board for Industrial and Financial Reconstruction three years ago, but became a zero debt company in October 2003. The Government converted Rs 3,330-crore loan component and Rs 791-crore interest component into equity and preference shares.

The company was able to come out of the red following a spurt in steel prices, effective cost management and financial controls. It has also performed beyond rated capacities consecutively for the last three years.

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