KOLKATA: Vedanta Limited has plans to set up a steel plant in Jharkhand with a capacity of 4.5 million tonnes (MT), entailing an investment of about $3-4 billion over the next few years. The new plant, primarily part of its second phase of capacity expansion, will be set up adjacent to its newly acquired Electrosteels unit in Bokaro. “We have 2,200 acres at the existing facility in Jharkhand, we may need to acquire a little more,” said Anil Agarwal, founder and executive chairman, Vedanta Resources.
Currently, the company is considering expansion of the capacity of Electrosteel to about 7 million tones (MT) in phases. “Our immediate plan is to expand capacity to 2.5 MT from 1.5 MT now, with an investment of about $300 million over the next two years,” he said, adding the company is also studying the ‘feasibility’ of scaling it up to 5 MT in the next three to four years.
The company is in talks with Korean, Japanese and Chinese firms for technology and machinery for its proposed expansion, Agarwal said. Expressing his intent to create a “second Bokaro”, Agarwal hoped that requisite clearances for the project would be in place in the next six to eight months. “Currently, Bokaro produces about 7-8 MT and we are working towards creating another Bokaro in Jharkhand,” he said.
The company is also mulling a 5 mtpa steel plant at Bellary in Karnataka, at an estimated cost of Rs 30,000 crore.
The metal and mining giant is committed to investing $8 billion on various projects across businesses in the next three years. At the end of June quarter, the company’s net debt stood at Rs 29,910 crore, higher than the last quarter on account of the acquisition of Electrosteel and adjustment of working capital with borrowings. The company has cash and liquid investments of Rs 35,251 crore. Its net debt to EBITDA ratio stands at 1.1x.