Action Ispat and Power plans to expand steel capacity in Orissa to about 2.5 million tonnes a year over the next three years. The company is also thinking of setting up a new plant on the West Coast, its CEO, Mr Navneet Agarwal, said.
Action Ispat, part of the privately-held Action Group — known for its shoe business — currently operates a 0.25 mtpa steel plant at Jharsuguda in Orissa. “We are setting up a rolling mill by the end of this financial year, which should expand our capacity to 0.5 mtpa,” he said.
The company plans to invest another Rs 1,000 crore for its immediate expansion. This will be funded through internal accruals and bank credit . So far, the company has invested about Rs 1,000 crore in the steel plant, which mainly produces billets and long products like rebars and structurals.
Action Ispat has been allotted iron ore linkages by the Orissa Government and the company hopes to secure all clearances over the next two to three years for the same. The company currently operates a 37 MW power plant and expects to commission another 90 MW by the end of this quarter, he said.
The company sees strong demand for steel in the North and West. “We want to be closer to the market,” Mr Agarwal said, on the rationale to locate the new plant on the West Coast . Action Ispat may also float its shares over the next two years to help fund its new plant, Mr Agarwal said.