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Tata Steel to raise funds for ongoing expansions in Odisha project

Tata Steel Managing Director H M Nerurkar says we will obviously need to raise money because of our ongoing expansions in Odisha, but we have not finalised our plans.

twitter-logoPTI | August 28, 2012 | Updated 07:34 IST

Tata Steel needs to raise money for its ongoing expansions in Odisha , atop company official said on Monday.

"We will obviously need to raise money because of our ongoing expansions in Odisha, but we have not finalised our plans," Tata Steel Managing Director H M Nerurkar told reporters on the sidelines of an award giving ceremony.

Tata Steel is putting up a six million tonnes per annum (mtpa) greenfield facility at Kalinganagar in Odisha in two equal phases with around Rs 34,500 crore investment.

It has spent Rs 3,700 crore up to March, 2012 in the project, which was proposed to be funded through a 65:35 debt-equity ratio.

Tata Steel had earlier said that the first phase of the Odisha plant with three mtpa capacity would be implemented by 2014.

The steel maker has 6.8 mtpa steel-making capacity at the lone domestic facility at Jamshedpur. Overall, it has a total 27 mtpa capacity including operations in the UK and the Netherlands. It is expanding capacity of its Jamshedpur plant by three mtpa through brown-field expansion.

"It is for sure that we have not scaled down our modernisation plans and obviously we will require the funds to carry those out," he added.

Nerurkar said Tata Steel India would continue its effort on improving the performance. However, with difficult market conditions in Europe, it has taken various initiatives to reduce cost, rationalise the portfolio.

"I am sure these are challenging times and is not something that is going to pass tomorrow. But, we will fight it out and I am sure our colleagues in Europe will ensure that the situation changes," he added.

On steel demand, Nerurkar said, "If you take economic growth as seven per cent, then the industry should grow at eight per cent. I hope infrastructure sector sees growth on the ground, so that there is a fillip to the steel industry".

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