The Rs 400-crore phase-I expansion of Balasore Alloys Limited (BAL), part of Ispat group of companies, may be delayed by about a year due to delayed financial closure for the plan. Though the company intended to complete phase-I by the end of 2009, it is most likely to be completed by the end of 2010, says BAL Managing Director R K Jena.
The global recession has made the banks cautious while lending. However, the company has appointed SBI Capital as its consultant and hopes to achieve financial closure in the next six months.
While the slowdown impacted the ferro chrome units across the country, BAL has maintained its operations at 100 per cent capacity. Though the firm’s bottom line has been affected with a third quarter loss of Rs 30 crore, it has recorded a cumulative profit of Rs 27 crore in the first nine months of the current financial year.
Despite incurring a loss due to a 60 per cent decline in the international price of ferrochrome and only 20 per cent decline in the raw material price, the company has not laid off any staff. It has about 700 permanent and 400-500 temporary workers. “We are focussing on maintaining the production, while keeping the employees’ morale high,” Jena added.
Exports have not been affected much, Jena said. European, North American and southeast Asian markets are the major revenue generators for BAL. It achieved a turnover of Rs 450 crore in FY08 and has targetted to raise it to Rs 600 crore by the end of March 2009. It has already achieved a turnover of Rs 530 crore.