Global steel major Tata Steel on Tuesday posted over two-fold jump in net profit for the third quarter and said it has earmarked around $2.5 billion capex per annum for the next three years.
The funds would be used for the leading private company's various upcoming and a few ongoing projects globally, a top executive said.
"We have earmarked $2.5-billion per annum towards capital expenditure for the next three years," Tata Steel Managing Director H M Nerurkar told reporters while announcing the results for the reviewed period in Mumbai.
The company has reported a consolidated net profit at Rs 1,003.02 crore for the quarter that ended December 31, as against Rs 472.65 crore in the corresponding period last year on back of increased sales, especially from the auto sector.
"The performance of the Indian operations in the third quarter for 2010-11, in spite of inflationary concerns, continued to be robust on the back of an improved product-mix and efficiency enhancement measures. However, the south-east Asian operations were affected due to rising scrap prices," Nerurkar said.
European operations were also affected due to rising cost of raw materials and other seasonal factors, he said.
The company's consolidated net sales (from Europe, India, Thailand and Singapore) increased to Rs 28,606.15 crore in the third quarter as against Rs 26,068.55 crore in the year-ago period.
On a stand-alone basis, the steel giant has registered a net profit of Rs 1,513.46 crore in the quarter under review as against Rs 1,191.75 crore in the same quarter last financial year.
The company's net sales in the three-month period also increased to Rs 7,324.69 crore from Rs 6,307.48 crore in the same quarter last financial year.
On deliveries, Nerurkar said there was a quarter-on-quarter improvement on the back of rising demand from the auto and construction sectors.
However, in the third-quarter, the firm delivered around 5.68 million tonnes of steel as against 6.02-million tonnes in the year-ago period.
On investments, Nerurkar said Tata Steel, which had raised Rs 3,477 crore through an FPO last month, would use around Rs 1,875 crore of the funds to fuel expansion of its Jamshedpur plant.
On its JV with Japan's Nippon Steel, he said the proposed Continuous Annealing and Processing Line (CAPL) for production of 6 lakh tonnes per annum of automotive cold-rolled steel at Jamshedpur will be operational by 2013. The project cost is around Rs 2,300 crore.
On its Kalinganagar steel project in Orissa, Nerurkar said work is in progress and the company has already registered with itself around 3,000 acres of land of the total 3,400 acres alloted to it by the Odisha Government.
The project, to be completed in two phases with a total of 6 million tonne steel capacity, is likely to be commissioned in 2015.