Mining giant Vedanta Friday said its business has seen improvement since June 2018 when it acquired Electrosteel Steels Ltd (ESL), leading to a healthy financial position.
"Since June 2018...There have been significant gains in operational efficiencies, such as a substantial reduction in the coke rate at blast furnaces...optimisation of the coal mix and iron ore blending; and improved yields of the finishing mill to 96.7 per cent (from 95.9 per cent in 2017-18)," Vedanta said in its annual report 2018-19.
In June last year, Vedanta had acquired a 90 per cent stake in ESL, a primary producer of steel and downstream value-added product, it said.
"The business was acquired under the Insolvency and Bankruptcy Code (IBC) 2016, in line with the resolution plan approved by the National Company Law Tribunal (NCLT), Kolkata," the report said.
The acquisition was made for a consideration of Rs 5,320 crore, paid upfront for a 90 per cent stake.
Following the deal, the company was delisted from stock exchanges and is now owned by Vedanta Ltd through Vedanta Star Ltd.
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ESL's manufacturing facility is a greenfield integrated steel plant located near Bokaro, Jharkhand, which has a current capacity of 1.5 million tonne per annum (MTPA) and the potential to increase to 2.5 MTPA.
"With operations completely revamped, FY2019 has seen record production levels. The business achieved a run-rate of...1.5 mtpa in Q4 FY2019. The production ramp-up and other operational efficiencies have resulted in a record Ebitda (earnings before interest, tax, depreciation and amortisation) margin for the business, improving from USD 53 per tonne in FY2018 to USD 122 per tonne in Q4 FY2019," it said.
Reaffirming the commitment to the local people of Thoothukudi in Tamil Nadu, the company said that it has announced Rs 100 crore investment in social infrastructure plans.
"The vision includes a clean and green community with the planting of one million trees, high-quality education delivered through a fine and well-equipped school, a world-class hospital, a desalination plant and youth development schemes," it said.
The Tamil Nadu government had in May last year ordered permanent shutdown of Vedanta's copper smelter after bloody protests at the plant in Thoothukudi culminated in police opening fire on demonstrators.