It is reported that RKKR Steels, a leading steel manufacturer in South India, intends to triple the steel making capacity to 1.5 million tonnes per annum at the upcoming integrated steel facility in Nellore district of Andhra Pradesh with an additional investment of INR 2,900 crore, taking the total investments to INR 4,000 crore.
Mr Rajiv Rai chairman of RKKR group said that “The company is now preparing a blueprint to take the capacity to 1.5 million tonnes per annum of steel products of very high value and this will be a reality with the support of the Andhra Pradesh government. With this, the total investments will touch INR 4,000 crore and the job potential will cross 10,000.”
He added that “This expansion will involve an additional area of 1,000 acres and a captive plant of 250 mw besides a 10 MLD desalination plant. Other infrastructure will include a railway siding into the plant and a conveyor for coal and ores from Krishnapatnam port. The plant will cater to most of the steel requirements for the automobile and engineering units in south India besides being capable of producing high value steel for the nuclear power equipment industry.”
Mr Rai said that the funding for this expansion will come from a combination of internal generation, debt and an IPO. The promoters plan to hold 60% to 65% of the equity post IPO. The company plans the IPO some time in Q4 of 2010 by when existing investments would have been completed and started delivering results.
RKKR is putting up a 0.5 million tonne integrated steel project over three phases at Chillakuru Mandal of Nellore district under a separate company called SBQ Steels to make special and alloy steels for automotive ancillary units. The total investment for the three phases is INR 1,100 crore. SBQ Steels has raised INR 136 crore via private equity investments by diluting 14% for the third phase fund needs.
The first phase has been completed and the CM of Andhra Pradesh will inaugurating the 500,000 tonne integrated pig iron plant on Wednesday.
(Sourced from www.steelguru.com)
Tuesday, September 1, 2009
RKKR Steels to expand capacity of steel plant in AP
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