Steel Exchange India Limited (SEIL), engaged in steel production, expects to achieve financial closer for its Rs 315-crore coal-based captive power plant in a month or two.
The Visakhapatnam-based company has floated Simhadri Power Limited to set up a 60-Mw power plant at Kothavalasa near here. SEIL has a 26 per cent stake in the power company. “SEIL promoters are investing around Rs 82 crore as equity while for the remaining Rs 233 crore we have approached financial institutions,” B Satish Kumar, managing director of SEIL, told Business Standard.
The project is to be financed by a consortium led by State Bank of India, he said. SEIL already has an 8-Mw gas-based power plant at Ravulapalem in East Godavari district. “We are ready with civil and other drawings, and would soon start the construction work on the proposed power plant," he said.
The company hopes to begin commercial production by December 2012. Most of the power generated from this plant would be utilised by its 250,000-tonne capacity integrated steel mill in the Kothavalasa area and the surplus, if any, would be transferred to the state grid, he said.
SEIL is currently purchasing coal from the Mahanadi coalfield for its integrated steel plant. It is in talks with Mahanadi for additional coal to meet the requirements of the proposed power plant. The listed company operates two steel units with a production capacity of 300,000 tonnes and has been marketing its products under the brand Simhadri Steel TMT bars.
SEIL, during the last financial year, posted net margins of Rs 16 crore on a turnover of Rs 702 crore and this year expects the turnover to be Rs 750 crore.
