The Hindu Business Line : SPS Steel investing Rs 450 cr more in Orissa unit

Kolkata, Sept. 11 SPS Steel & Power, part of the Rs 2,000-crore turnover SPS Group of Companies that has interests in the steel, entertainment and hospitality sectors, has unveiled plans to invest an additional Rs 450 crore on augmentation of various capacities at its steel plant at Jharsuguda in Orissa.

IPO plans

The company has also proposed to float an initial public offering in 2008 to raise a portion of the Rs 1,200-crore that would be required to set up a 250-MW capacity thermal power plant either at Jharsuguda or Dhenkanal in Orissa. Power from the proposed plant would be used for captive consumption,

Mr Bipin Kumar Vohra, Chairman and Managing Director of the SPS Group, said at a news conference here.

Expansion

Mr Vohra said that, with an additional investment of Rs 450 crore, the total cost of the steel project in Orissa would go up to Rs 1,450 crore. The capacity of the Jharsuguda plant would now go up from 0.5 mtpa to 1 mtpa. Mr Vohra said the company was installing two mini blast furnaces each having a production capacity of 2.7 lakh tpa. By December this year, two rolling mills would commence production. They would produce 1.2 lakh tpa of the Elegant brand TMT bars and 1.4 lakh tpa of structurals.

“In 2008, we have proposed a IPO after most of our facilities go operational. The money we raise will part-finance the setting up of a 250-MW thermal power plant that we propose to set up at Jharsuguda or Dhenkanal at an estimated investment of Rs 1,200 crore,” he said.

Acquisitions

According to Mr Vohra, SPS Steel & Power has acquired the Jharsuguda-based Pawan Sut Sponge Iron for a consideration of Rs 30 crore. The plant has a capacity to manufacture 72,000 tpa of sponge iron.

The company has also bought the steel unit of the Himachal Pradesh-based Suraj Fabrics Ltd for a consideration of Rs 40 crore. That plant, too, has a capacity to manufacture 72,000 tpa of sponge iron. The SPS Group has also applied to the Meghalaya Government for setting up a clinker plant in the State for manufacturing cement, Mr Vohra said.

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