By IANS,
Kolkata : Steel manufacturer Jai Balaji Industries hopes to start work on a new integrated steel, cement and power plant in Purulia in November if the West Bengal government releases the required land soon, a top company official said here Thursday.
“We hope the WBIDC (West Bengal Industrial Development Corporation) will hand over the requisite land soon so that we can start work on the Purulia project from November,” Jai Balaji chairman and managing director Aditya Jajodia told reporters on the sidelines of the company’s annual general meeting.
The steel company is setting up a five million tonne integrated steel plant, a three million tonne cement plant and a 1,215 MW captive power plant on an investment of Rs.16,000 crore (Rs.160 billion or about $4 billion).
Jajodia said the project is expected to be completed within seven years.
“We require a total of 3,800 acres for the entire project. For the first phase, we will require 1,200 acres and the government will soon provide us with the land, after which we can start the work,” Jajodia said.
The investment for the first phase of the company will be Rs.6,000 crore (Rs.60 billion), out of which Rs.4,200 crore (Rs.42 billion) will be through debt and the rest will be internal accruals.
Financial closure for the first phase will be done within six months, he said.
In the first phase of the project, which the company expects to complete within three years will have a two million tonne steel plant, one million tonne cement plant and 400 MW power plant.
It plans to source iron ore for the project from Orissa and Jharkhand and it has also applied for coal linkages.
“We expect to become a group producing six to seven million tonnes of steel per annum within seven years when the project is completed,” Jajodia said.
At present, Jai Balaji produces 1.1 million tonnes of steel annually.
“We may dilute five percent stake of the company after two-and-half years,” Jajodia said.
Last month, Jai Balaji signed an agreement with the Chhattisgarh government to set up a one million tonne cement plant in that state.
“Work in the Chhattisgarh plant will start only after the Purulia project is completed,” Jajodia said.
In the first quarter of the current fiscal the company has recorded 96 percent growth in net profit at Rs.460 million compared to Rs.230 million in the corresponding period last quarter.
The net turnover during first quarter of 2008-09 increased by 86 percent to Rs.4.64 billion from Rs.2.49 billion in the corresponding period last fiscal.