Comments
SAIL has begun to scout for a technology provider for the production of ‘cold-rolled grain-oriented' steel in India — a kind of steel that is used in electrical transmission and is five times as costly as cold rolled steels.
It will be second coming for the public sector steel major if it is successful in breaking into this business, because a couple of decades ago SAIL unsuccessfully tried to produce this steel in India.
CRGO technology is said to be with just about half a dozen companies globally, and one of them will have to be induced to impart knowledge.
On Tuesday, the Chairman and Managing Director of Bharat Heavy Electricals Ltd, Mr B.P. Rao, had told journalists here that SAIL and another steel PSU, RINL, would put up a CRGO project and that BHEL — a major consumer of CRGO with annual requirement of about 40,000 tonnes — was interested in picking up 26 per cent stake in the venture.
Today, SAIL's Chairman and Managing Director, Mr C.S. Verma, put it slightly differently. He did not talk of a joint venture, or BHEL's participation, but said that all kinds of options were under examination.
The first step, he said, is to secure technology without which no project would happen. If technology is secured, a project of about 200,000 tonnes would come up, at an investment of about Rs 3,500 crore, he said.
It is not clear as to why any company would want to part with the technology when it could export the steel to India.
“That is why we are giving them equity,” is how Mr Rao answered this question.
Incidentally, the National Manufacturing Competitiveness Council, headed by Dr V. Krishnamurthy, has recommended to the government that overseas steel suppliers ought to be coaxed into setting up shop in India to produce CRGO, by making a commitment to that effect as a condition before awarding other steel projects to them here.
FPO in February
Mr Verma, who was here to participate in the 52{+n}{+d} National Cost Convention-2011 organised by The Institute of Cost and Works Accountants of India here, said that SAIL's follow-on public offer would hit the market in mid-February. Government of India will divest 5 per cent stake in the company to raise Rs 4,000 crore. SAIL would also issue fresh equity to raise another Rs 4,000 crore.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.