SEIL to tie up funds for pellet plant soon

While Rs 200 cr loans would be tied up from banks, promoters would invest the remaining as equity

City-based listed company Steel Exchange India Limited (Seil) is targeting to achieve financial closure for its proposed Rs 300-crore pellet plant soon.

While Rs 200 crore loans would be tied up from banks, promoters would invest the remaining as equity. "We have already applied for environment clearance. Once we get it, the company will approach financial institutions. We are confident of achieving financial closure by 3-4 months," B Satish Kumar, managing director of Seil, said.

The company operates a 300,000-tonne capacity integrated steel unit in Kothavalasa near here.

The pellet unit would come up at its existing steel plant and would help it cut production cost. "Getting iron ore fines is easier and cheaper than procuring lumps. Hence, if we convert iron ore fines into pellets and use them for making steel rather than using iron ore lumps, our steel production cost may reduce by 15 per cent," he said.

The proposed plant would have a capacity to produce 600,000 tonne pellets, of which about 300,000-tonne will be used by its existing unit. The remaining will be exported to other countries.

The company has also set up a 60-Mw captive power plant. It expects to produce 200,000 tonne steel this financial year and 300,000 tonne in the next fiscal.