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Our Bureau

The move will help forge linkages with existing iron ore, power units

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Kolkata Feb. 1 Usha Martin Ltd will commence captive coal mining within the next six months. When that happens, the specialty steel and wire rope manufacturing company's raw material linkages would be complete. The company already has captive iron ore mines and power generation units.

Addressing a press conference held here on Wednesday to announce the company's financial performance during the third quarter of the current fiscal, Dr P. Bhattacharaya, Joint Managing Director of Usha Martin Ltd, said the forging of linkages to coal, iron ore and power would have a positive impact on the company's bottomline. Already, linkages to iron ore requirements had helped the company cut input costs.

Dr Bhattacharaya said the company was in the process of making a capital investment of Rs 1,350 crore. The investments would be made in logistics, minerals and power distribution, in increasing the steel production capacity to one million tonnes, in value addition to the product mix and in strengthening the company's global distribution and marketing network.

Money sourcing

Towards this end, an amount of Rs 200 crore has been raised by way of GDRs/promoters equity. A further sum of Rs 500 crore would comprise the debt component from State Bank of India and ICICI Bank. The balance amount required would be generated from internal accruals over the next three years. According to him, the company would continue to focus on becoming the largest wire rope company in the world. When it achieves one million tonnes steel production three years from now, 50 per cent of it would be value added by the company itself.

Quarterly results

During the quarter ended December 30, 2006, Usha Martin recorded a net sales income of Rs 351.39 crore, up from Rs 315.80 crore recorded during the corresponding period of last year. The profit before tax during Q3 of the current fiscal was Rs 39.11 crore compared with Rs 24.86 crore in Q3 of the last fiscal. The profit after tax in Q3 of 2006-07 was Rs 28.41 crore against Rs 16.50 crore in Q3 of 2005-06.

More Stories on : Outlook | Steel | Coal

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