Tata Steel to pump in Rs 1 trillion over 15 yrs

Tata Steel unveiled a roadmap for the next 15 years, entailing an investment of Rs 1,00,000 crore for enhancing production capacity to 34 million tonne.

Addressing a press conference, B Muthuraman, managing director, Tata Steel, said, the company's investment for projects announced so far involved an investment of around Rs 100,000 crore. This includes the Rs 53,000 crore fresh investment in Jharkhand at Jamshedpur Works and the 12 million tonne greenfield plant, announced on Thursday.

Muthuraman said, the investment also included the six million tonne greenfield plant announced at Duburi in Orissa and the five million tonne in Chhattisgarh, as well as the proposed projects in Iran and Bangladesh.

When asked about funding options for the investment, he said, the company was yet to decide on the mode of financing the investment. However, the investment would be spread over 12-15 years.

The private sector steel major is also eyeing fresh acquisition in South-east Asia. Muthuraman said due diligence was on for fresh capacity acquisition in the region to the tune of two million tonne and the deal was expected to materialise over the next 4-5 months.

Tata Steel's massive steel expansion would be backed by required backward linkages. Muthuraman said the Jharkhand government had assured the company of adequate iron ore reserves.

Tata Steel had asked for 600,000 tonne of iron ore reserves for 30 years for the proposed 12 million tonne plant and another 400,000 tonne for the next 20 years. For expansion at Jamshedpur Works from five million tonne to 10 million tonne, the company has asked for 400,000 tonne of iron ore.

The company has also decided to partner BlueScope Steel for setting up manufacturing facilities in India. Muthuraman said the first manufacturing unit for a colour coating line would come up in Jamshedpur and the next one was likely to come up at Duburi in Orissa.

The total investment in the project would be around Rs 1,500 crore. The 50:50 joint venture company would be formed over the next three months.

Tata Steel would supply the cold-rolled material, which would be galvanised at the manufacturing facility.

Alongside steel expansion, the company was also working on its titanium manufacturing project. The feasibility study for the project has been completed and the company was in the process of acquiring land to the tune of 25,000 acres at Tuticorin in Tamil Nadu, Muthuraman said.

The first phase of the project would cost Rs 400 crore, and the subsequent two phases Rs 400 crore and Rs 1,200 crore, respectively. However, it appeared that the project would span over a long period of time as the first phase would spread over four years.

On the proposed ferro chrome project in South Africa, Muthuraman said it was delayed by over a year for environmental clearances but the company had now identified an alternative location at Richards Bay, close to the original location.