India's Jayaswal Neco Plans $730 Million Expansion in Steel, Mining and Captive Power Sectors

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Researched by Industrial Info Resources (Sugar Land, Texas)--Following the announcement of full debt tie-ups for $730 million at the end of 2010, Jayaswal Neco Industries Limited (BSE:522285) (Nagpur, Maharashtra), which is the flagship company of the Neco Group of Industries, is planning steel, mining and captive power projects to enable it to double turnover by 2014.

Jayaswal Neco is split into three divisions: steel mill, foundry and mining , and the company has begun planning the implementation of major expansion projects across all divisions.

The company started in 1976 as a small-scale iron foundry. Since then, it has grown to have its own coal and iron ore mines in Chhattisgarh and Jharkhand, as well as a fully integrated steel mill occupying more than 1,800 hectares in the industrial area of Raipur, Chhattisgarh, which has a capacity of 1 million tons per year.

The company is now planning to expand its 100,000-ton-per-year coke oven plant. The steel melt shop will expand by 450,000 tons per year, and the rolling mill will expand by 350,000 tons per year. The wire rod mill will be modernized.

In addition, Jayaswal Neco is planning to set up a 300,000-ton-per-year sponge iron plant with a 62-megawatt (MW) captive power generating capacity.

In its mining division, the company plans to develop its non-coking coal mines, iron ore mines and a 3 million-ton-per-year coal washery in Chhattisgarh. In Jharkhand, plans include the development of coking coal mines and a 1 million-ton-per-year coal washery.

According to Jayaswal Neco, the implementation of these projects "would help the company achieve total captive low-ash metallurgical coke-making capacity, self-sufficiency in entire captive power requirements, monetization of benefits of non coking coal mines by setting up additional sponge iron plants and of coking coal and iron ore mines by developing them for usage in its integrated steel plant at Raipur."

The company continued, "The expansion will allow for complete forward integration by setting up a world-class steel melt shop and end-product rolling mill with the capability to roll all products and types of high-alloy steel, spring steel, carbon steel and stainless steel of all grades and all sizes in the long products segment."

The net result of the expansion plans will give the company an iron-making capacity of 1.3 million tons per year; a finished steel making capacity of 1.1 million tons per year; 105-MW capacity in captive power plants; coal washeries with a capacity of 4 million tons per year; coke oven plants totaling 200,000 tons per year; 800,000 tons per year in sinter plants and ferrous casting capabilities of 100,000 tons per year.

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