State owned Rastriya Ispat Nigam Ltd, better known as Vizag Steel, expects to start ordering equipment for its proposed Rs 300-crore axle plant by the second quarter of 2012-13.
The project is to be located near Siliguri in Northern part of West Bengal, will cater to the Indian Railways. The Railways has handed over land for the project to RINL.
“We have invited expressions of interests from the possible equipment suppliers. We are hopeful to start ordering the main packages for the project in another six months,” the Chairman and Managing Director, Mr A.P. Chaudhuri, said here on Sunday on the sidelines of 4th Asian Mining Congress.
Meanwhile the company's Vizag Plant will start operating at the expanded 6.3 million tonne liquid steel capacity within this fiscal. “We have nearly completed the commissioning of the Rs 12,500-crore project. The expanded capacity will be available for production from this fiscal,” he said.
While the company has arrangements in place for sourcing 9.8 mt of ore to feed the 6.3 mt liquid steel capacity, efforts are on to secure more ore from NMDC and OMDC to add another million tonne of steel making capacity in a year.
“Once the expansion project is over we will start debottlenecking the old capacities. The project is expected to push total liquid steel capacities to 7.3 mt by 2013-14,” Mr Chaudhuri said.
Meanwhile, the Union Government spared the steel maker from paying any interim dividend owing its low cash reserve of Rs 1,500 crore following the expansion. The expansion project was completely funded by internal generation.
The Union Cabinet has recently approved 10 per cent disinvestment proposal in the company. While Mr Chaudhuri is yet to receive any formal communication in this regard, the exercise towards it is reportedly being taken in tandem with the equity restructuring. The company currently has a disproportionately large equity of Rs 8,000 crore.