Domestic steel giant SAIL is investing over Rs 2,600 crore for installing a three million tonnes per annum facility for hot rolled (HR) coils at its Rourkela plant to make auto-grade and special steel products.
The Maharatna firm has awarded the contract for setting up this hot strip mill to a consortium led by Mitsubishi and Larsen & Toubro, a source said.
The facility will produce high quality HR coils, including high strength API grades, auto body grades and other special steels, the source added.
Last week, Steel Secretary Rakesh Singh said that under SAIL's modernisation and expansion programme (MEP), various projects have been initiated, including this unit.
Singh holds additional charge as SAIL's chairman.
In a bid to fast-track its MEP, the public sector undertaking commissioned projects worth Rs 10,200 crore in the financial year ended March 2015.
SAIL is also finalising its Vision 2025 document, through which it aims to increase its hot metal production capacity to 50 million tonnes, along with related business activities.
In a bid to keep pace with growing competition and optimise production as well as costs, the steel maker is investing in research and development (R&D) initiatives.
In 2014-15, SAIL spent Rs 284 crore on R&D, the highest by any steel maker in India.
Its R&D centre developed 24 new products during the last fiscal and the expenditure was 0.56 per cent of sales. It had clocked a sales turnover of Rs 50,627 crore during 2014-15 and its net profit stood at Rs 2,093 crore.
During last fiscal, its capital expenditure stood at Rs 6,840 crore, which is expected to rise to Rs 7,500 in 2015-16.
SAIL's hot metal production rose by 7 per cent to 15.4 MT in 2014-15 against the previous year. Saleable production was up by 3 per cent at 13.5 MT.
