TV Narendran: Tata Steel may increase CapEx to achieve 40 MT target

TV Narendran, Tata Steel's CEO and Managing Director, announced that the rising steel pricing and strong demand might lead the company to accelerate its declared capacity expansion objective by a few years. Narendran said that if the company moves on with its growth plans, it would be able to meet its 40 million tonnes (MT) installed capacity target in India by 2030. In India, the company's installed capacity is 20.6 MTs. In fiscal year (FY) 2022, the company produced 19.06 MTs. The company expects to spend Rs 12,000 crore on capital expenditure (CapEx) this FY. It will, however, review the situation after six months and, if necessary, amend it upwards. Narendran said that they can always go back to the board and ask for more and spend more if the markets are robust, the cash flows are high, and the deleveraging is proceeding as expected. The MD informed that unlike before when the group just had one location in Jamshedpur, growth could only happen in stages. Currently, they have two locations in Kalinganagar and one in Angul, so they have the flexibility to expand faster tomorrow if demand in India goes up and profitability remains strong. He said that, while the corporation is not currently updating the 2030 schedule, it would continue to do so. The 40 MT plan comprises extending the Kalinganagar plant to around 16 MT capacity from the current 8 MT expansion, including expanding the Neelachal Ispat Nigam (NINL) site to 10 MT capacity from its current 1 MT capacity. The purchase of NINL is likely to be completed by June. After acquiring Bhushan Steel, the company's capacity was increased from 3 million to 5 MT per year, with the potential to grow to 10 MT. Currently, Rs 8,500 crore has been set aside for the ongoing growth of Kalinganagar from 3 million to 8 MT per annum, as well as significant expansions in the company's iron ore mining, which it plans to increase from 33 million to 50 MT per annum over the next few years. The remaining Rs 3,500 crore will be used for operations in Europe. During the year, the business will also invest Rs 12,000 crore to complete the recent acquisition of NINL. Image Source Also read: Tata Steel to break ties from its business with Russia