Jindal Aluminium, the country’s largest aluminum extruded products maker, is looking to invest ₹150 crore-odd over a two year period as it looks to bring on-stream new capacities across its two verticals – extrusions and rolled products.
The company will ramp up capacities by nearly 50 per cent primarily across the extrusions vertical.
Its existing capacity in the extrusions segment is 1,25,000 tonne per annum; while in the rolled products category the capacity stands at 50,000 tonne per annum.
According to Pragun Jindal Khaitan, Vice Chairman and Managing Director, Jindal Aluminium Ltd, investments towards incremental capacity addition would be funded through internal accruals.
Of ₹100 crore-odd investment, a part will go towards de-bottlenecking at the existing unit in Bengaluru while the majority will be spent as capex in upping capacities at the recently acquired Indo Alysus Ltd plant. The Bhiwadi (Rajasthan) plant, which Jindal Aluminium acquired at a cost of ₹100 crore has a capacity of 15,000–18,000 tonne per annum. It will be expanded by another 32,000 tonnes per annum, to 50,000 tonnes per annum over the next few quarters.
Capacity addition at the rolled products unit - with the addition of the fifth caster – happened in 2019. Two more casters are expected to be added in over the next 12 -18 month period at a ₹50 crore cost thereby taking the total capacity up to 75,000 tonne per annum.
“We are open to Greenfield capacity expansion in the future. The Indo Alysus acquisition will bring us closer to customers in North India – one of our larger markets. We are targeting to close FY22 at Rs 3000 crore,” he told BusinessLine.
Once capacity additions come on stream, it is expecting a 15 per cent increase in the company top-line; and 20 per cent addition to aluminum extrusion businesses topline. Extrusions account for 65 per cent of its topline and rolled products the remaining 35 per cent.
Jindal Aluminium is witnessing a CAGR of 8-10 per cent, in line with the industry.
“We do not plan to get into mining. We procure aluminum from the primary players. The base price of primary aluminum is determined by London Metal Exchange rates,” Khaitan added.