Tata Steel to develop 40 high-end products at Kalinganagar unit, trials on

New products being designed mainly for auto, oil & gas sectors; firm is raising plant capacity from three mtpa to eight mtpa

Reaffirming its focus on product innovation, Tata Steel plans to develop 40 new product grades at its greenfield steel project at Kalinganagar (Odisha) in this financial year.

The new products are designed primarily to tap into the requirements of automotive and oil & gas industries. 

“One of the products we have developed is a specialized disc rim for wheels to cater to the automobile industry. Trials of the product have already begun to Tata Motors. Commercialisation of the product is expected in six months. We have also initiated talks with other auto OEMs (Original Equipment Manufacturers) like Maruti Suzuki and Toyota,” a Tata Steel source said.

Initially creating a capacity to produce three million tonnes per annum (mtpa), Tata Steel is now in the midst of expanding the Kalinganagar plant's capacity to eight mtpa, pledging a Capital expenditure (capex) of Rs 23,500 crore. The five mtpa brownfield expansion includes 2.2 mtpa cold rolling complex, raw materials and related facilities. The ramp-up will tweak Tata Steel's product mix in favour of auto grade steel and branded products, retail & solutions. 

The domestic auto industry depends on imports, chiefly from South East Asian countries for niche products where domestic steel makers lack core competencies. Tata Steel's planned auto grade steel products will not  just act as import substitutes but offer a superior experience to  its downstream consumers, the source said.

Tata Steel is one of the key suppliers of high-tensile and auto galvanized products. Also, the steel company is the largest supplier of skin panels. Tata Steel retained its hegemony in automotive grade steel segment, boasting of 47 per cent market share in FY19.

The steel maker's focus on research and innovation has been continuous and unswerving. In Q4 of FY19, the steel monolith developed 17 products, commercializing four of them. 

The company's auto sales grew 21 per cent year-on-year (y-o-y) to 2.25 million tonnes (mt) in last fiscal with high end product mix improving in automotive sales. Its overall sales volumes soared 33 per cent y-o-y to 16.26 mt, gaining in market share across verticals. Branded products contributed 42.5 per cent (excluding Tata Steel BSL) to total sales.

Production grew by 35 per cent y-o-y to 16.81 mt in FY19 with the acquisition of Tata Steel BSL and ramp-up at both Kalinganagar and Tata Steel BSL.