SAIL, NMDC and RINL hope to meet cumulative INR 15,820 crore target

SAIL RINL NMDC to achieve INR 15820 crore CAPEX target in FY14

Business Standard reported that having failed to achieve their capex targets last fiscal, three major state owned firms SAIL, NMDC and RINL hope to meet cumulative INR 15,820 crore target set for the current fiscal.

Expressing hope of achieving their targets at a meeting with Finance Minister Mr P Chidambaram recently, Steel Authority of India has said that its INR 11,500 crore capex target for the current fiscal was on track.

Similarly, Rashtriya Ispat Nigam and country's largest iron ore producer NMDC have also expressed confidence in achieving their INR 1,600 crore and INR 2,720 crore capex targets for the 2013 to 14 fiscal.

These firms, which fall under the Steel Ministry, had failed to come even close to their capex targets last fiscal due to reasons ranging from delays on the part of contractors to unforeseen developments while executing projects.

SAIL had INR 14,500 crore capex target for 2012 to 13 fiscal but it could achieve only INR 9,755 crore. RINL's capex target fell short by over 30% to INR 1,287 crore. NMDC's was the worst at INR 1,607.24 crore compared to the INR 4,655 crore target for capital expenditure for 2012 to 13 fiscal.

The source said that "A warning from the Finance Ministry that it may ask PSUs to declare a special dividend in case of shortfall in targeted capex has triggered a change in the way PSUs used to look at the targets. They are now in a hurry to achieve targets."

SAIL is investing on enhancing capacity at all its five major plants. The investment is part of the INR 72,000 crore that the company is putting in to raise capacity to 24 million tonne per year from 14 million tonne per annum now.

RINL's capex plans involve capacity expansion at its plant at Vizag from 2.9 million tonne per annum to 6.3 million tonne per annum. NMDC's capex is aimed at raising production capacity at its exiting mines.

These 3 firms have set for themselves an ambitious INR 14,925 crore capex target for the 2014 to 15 fiscal. SAIL plans to dole out INR 10,500 crore on capital expenditure, NMDC INR 2,890 crore and RINL the remaining at INR 1,535 crore.

(www.steelguru.com)

Posted in: Sail Steel Authority of India