Ispat Industries to spend Rs2600 crore on project in two years

Ispat Indusries Ltd plans to spend Rs2,600 core in the next two years on various projects which include a joint venture coke over plant, a two million tonne iron ore pellet project and 110 MW captive power plants, all the its Dolvi steel complex and additionally an iron ore mining project at Damkodwadi in Maharashtra.

Pramod Mittal chairman revealed the company's plans to the media after the company's annual general meeting in Mumbai, on Wednesday. He said an estimated Rs480 crore would be spent on the captive power units, another Rs1,100 crore on the coke oven plan and about Rs600 crore on the pellet plant while the balance Rs400 crore would be spent on the mining operations. The projects are set to be commission by 2011-12.

While the pellect project will come up in partnership with an Indian company, the coke oven project would involve a partnership with Stemcore of the UK for which the financial closure will be compeleted by November, Mittal said.

The completion of the projects will see the earnings before interest, depreciation, taxes and amortisation (EBIDTA) margin to rise to 35 per cent of the sales from the present 22 per cent.

Mittal said that while mining operations at Damkodwadi in Maharashtra are set to commence by the fourth quarter of 2010, local tie-ups in Brazil, Columbia and Mozamique for iron ore and coal projects have been finalised. The company has invested taken upto 40 per cent stake in each of the overseas ventures.

He added that the Brazilian venture is for iron-ore mining whereas projects in Mozambique and Columbia are for coal mining, said.