One of India’s steel majors, Jindal Steel, plans to set up an integrated steel plant with 2.25 million tonnes capacity in the SPS Nerol district of Andhra Pradesh announced the state government.
The State Investment Promotion Board (SIPM) chaired by Chief Minister Y.S. Jagan Mohan Reddy has allotted 860 acres of land to Jindal Steel Andhra Limited to establish an integrated steelworks with an investment of Rs 7,500 crore. The plant is slated to come up at Thamminapatnam in Nellore district and is expected to employ 2,500 people in four years, said an official statement detailing the several decisions of the SIPM.
According to a company spokesperson, “The company estimates to directly employ nearly 2,500 people while another 15,000 people will benefit from indirect employment opportunities”. The business operation is expected to generate a revenue of Rs13,000 crore annually.
Meanwhile, Jindal Steel and Power (JSPL) which has a dominant presence across steel, power, and infrastructure sectors and which owns and operates state-of-the-art facilities in Chhattisgarh, Odisha, and Jharkhand, is planning to double capacity to 12 million tonnes via the brownfield route at Angul in Odisha with a planned CAPEX of Rs18,000 crore.
To achieve its future plans, the company is planning to divest 100 per cent of its power subsidiary Jindal Power Ltd (JPL) in order to bring down the company’s overall debt. The total deal value including the company’s debts is estimated at approximately Rs12,000-13,000 crore.
The cash generation from this is likely to be ploughed into new investments.JSPL’s consolidated net debt during the March quarter of FY21 was down by Rs3,475 crore and by Rs13,773 crore in FY21.
The company’s net debt was at ₹19,332 crore on a consolidated basis.The company’s management has been talking about achieving EBIDTA levels of Rs15,000 crore and revenue of more than ₹50,000 crore in the coming years.