AV Birla Group may start alloy steel prodn

Aditya Birla Group, the country's second largest non-ferrous producer, is likely to enter into alloy steel production with a two million tonne per annum plant through its company Vikram Ispat.

"The group is seriously considering the alloy steel project as part of forward integration for Vikram Ispat - a 0.9 million tonne per year gas-based sponge iron producer with plans to expand to 1.5 MT annually," Metal Bulletin (MB) reported.

Vikram Ispat is wholly-owned by Grasim Industries, and has the potential to be a major player in the steel sector as it already has iron ore mining operations under the banner of Essel Mining in Orissa.

Meanwhile, Essel Mining is planning to expand its iron ore production to 15 million tonne by 2012 from the current eight million tonne.

MB said Essel Mining has applied for two new mines at Barbil in Orissa, and has sought necessary approvals from the centre and the state government. Essel has so far disfavoured entering into the steelmaking business and was instead keen on beneficiation and pelletisation plants.

The company tried to acquire 51% stake in another miner Sesa Goa but lost out to Vedanta Resources, the MB report added.