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Tata Steel Ltd proposes new tube units to tap the growing demand from oil and gas, and construction sectors.
“We will be adding capacity in the hollow sections for construction applications through a new unit in Kalinganagar and another unit for oil and gas applications,” said Mr Rajiv Mangal, Executive In-Charge, Tubes Division at Tata Steel.
Coastal location
The company may invest about Rs 400 crore to set up a 3 lakh tonnes a year unit in Kalinganagar. It is scouting for a location in the coastal area to locate the unit that will cater to oil and gas. “Oil and gas being voluminous in nature, the new unit will be on the coast side,” Mr Mangal said.
The Tubes Division has a current capacity of 4 lakh tonnes a year, accounting for a tenth of Tata Steel's flat product output of 4 million tonnes a year. Tata Steel is expanding its flat products output to 12 mtpa by 2015-16 through new capacity addition.
“We want to be 10 per cent of Tata Steel's flat products and have internally set a target of one million tonnes by 2015,” Mr Mangal said.
The Tubes Division, a profit centre, registered a turnover of Rs 1,900 crore in 2010-11, accounting for about seven per cent of Tata Steel's India turnover. “We expect to grow to Rs 2,200 crore this fiscal,” he added.
Tata Steel currently manufactures a bulk of its tube products in Jamshedpur and partly in Kolkata and two other locations. The Tubes Division, which also manufactures structurals, pipes, precision tubes used in automotive and power sector, registered a 6 per cent growth in output in 2010-11 at 3.7 lakh tonnes
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