Financial Daily from THE HINDU group of publications
Tuesday, Jul 26, 2005

Port Info

Group Sites

Corporate - New Projects

Nava Bharat Ferro plans Rs 200-crore expansion

C.R. Sukumar

Hyderabad , July 25

NAVA Bharat Ferro Alloys Ltd (NBFAL) is evaluating expansion plans involving around Rs 200 crore investment for its ferro alloys, power and sugar facilities.

This is part of the company's mega plan to attain control over power and ores in a bid to sustain long-term viability and be globally competitive, especially in the backdrop of recent violent swings in the prices of ores and finished products, the NBFAL Finance Director, Mr G.R.K. Prasad, said.

The Hyderabad-based Rs 559-crore company currently has three furnaces in Andhra Pradesh with a total capacity of 75,000 tonnes per annum and two furnaces in Orissa with a capacity of 50,000 tpa.

Following a Rs 20-crore de-bottlenecking programme taken up at Orissa furnaces, the capacity has been recently increased to 75,000 tpa.

NBFAL is evaluating a plan to add another furnace in Andhra Pradesh with a capacity of 50,000 tpa, involving an investment of Rs 35 crore. This would take the capacity in the State to 1,25,000 tpa.

To overcome the supply side pressures, NBFAL proposes to enter into long-term supply contracts with leading traders and steel producers and avoid stock overhang at the expanded capacity levels. Further, Mr Prasad said, the company's efforts on the chrome ore-mining lease might take some more time to fructify in view of the directions of Supreme Court, while efforts were under way to obtain reasonable control in the manganese ore area by strategic associations.

The company is also evaluating expansion of its power facilities. It currently has 50 MW capacity in Andhra Pradesh and 30 MW in Orissa. It is planning to set up an Rs 80-crore power plant with 32 MW capacity, which would take off by January next. To meet additional power requirements of Orissa furnaces, NBFAL is looking at drawing power from inter-State transmission of surplus power from Andhra Pradesh or from the local grid. It is also considering a plan to set up 15 MW captive power generation plant in Orissa, he said.

Having expanded cane-crushing capacity from 2,500 tonnes per day (tcd) to 3,600 tcd recently, the company is now weighing options to raise the capacity to 4,500 tcd first and further to 5,000 tcd over the ensuing two seasons. The co-generation capacity would also be increased to 9 MW from 5 MW at a cost of Rs 20 crore.

Mr Prasad said being a port-based unit and in close proximity to the sugar consumption zone, NBFAL is also looking forward to opportunities in the area of importing raw sugar and refining it. Currently, the average cane-crushing season is around six months a year. The proposed raw sugar refining activity would enable the company use its idle capacities for another three-four months.

Stating that the raw sugar refining activity offers exciting opportunity, Mr Prasad, however, said the company did not work out its impact on its business volumes.

The stock is currently hovering at Rs 360 on both the BSE and the NSE with a year's high of Rs 456 and low of Rs 182.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Unichem suspends Roha plant operations

Ford's new car to make global debut in India
Apollo Hospitals offloads 25 pc stake in Apollo Health Street
`No extension of deadline for revised clause 49 compliance'
IOC, GAIL bag awards
Amendment to accountants Bill referred to GoM
Reliance board may consider de-merger plan tomorrow
SAIL, NTPC plan to merge two joint ventures into single entity
Dabhol stake at Rs 150 cr
Exim Bank to buy 2.5% stake in Bombay Rayon
Strides Arcolab plans to buy manufacturing facility in Europe
Novopan to sell US subsidiary
Dahej project: ONGC may place orders for equipment by Aug
Nava Bharat Ferro plans Rs 200-crore expansion
Suspension issue: Honda workers clash with police
ONGC to raise Rs 230 cr from N-E region for power transmission SPV
Astra Microwave board okays 1:1 bonus issue
Dunlop won't come cheap, says Jumbo
Chhabrias reassessing revival package

Pennar Steels mulls capital restructure
Prospects for cost accountants
Hero Honda to finalise third unit location, investment soon
Apollo plans hospitals in seven `mini metros'

The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |

Copyright 2005, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line