Bhushan Steel expands Odisha plant capacity

The Delhi-based Bhushan Steel has increased the production capacity of its integrated steel plant in Odisha five times to 2.5 million tonnes. The plant, which mainly produces hot rolled coils (HRC), will operate at the enhanced capacity from September this year. 

The HR products are used for making cold rolled coils (CRC), which in turn are mainly used by the automotive and consumer durable sectors. Bhushan Steel, which is in the race to acquire the Bhubaneswar-based Orissa Sponge Iron and Steel, is essentially a mid-sized firm engaged in CRC or secondary steel making. 

“The Orissa plant was merely producing 0.5 million tonnes of HR steel so far, which wasn’t enough to meet the entire captive requirements. The facility has been expanded and will be fully operational in the next 5-6 months,” said Bhushan Steel director (finance) Nittin Johri. The company’s annual cold rolled steel making capacity is currently close to 0.9 million tonnes. 

Investments worth Rs 7,000 crore have been made for boosting the plant capacity by 2 million tonnes. A 450-mw power plant has also been set up to meet captive power requirements. “Close to 75% of the total HR produced at this unit will be used for captive purposes and the remaining 25% will be sold to the domestic secondary steel makers,” Mr Johri said. 

Bhushan Steel plans to expand the capacity of its Odisha plant to 5 million tonnes by 2012 at an investment of nearly Rs 8,000 crore. The expansion will be funded through a mix of debt and internal accruals.

Source: Economic Times

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