Jai Balaji to raise 13 bln rupees debt in next six months

Mon, Oct 26 05:28 PM

Steelmaker Jai Balaji Industries is planning to raise 13 billion rupees as debt over the next 6 months, for funding its 160 billion rupee integrated steel plant in Purulia at West Bengal, a top official told Reuters.

"The total cost for the first phase of the West Bengal Steel plant would be around 27 billion rupees, of which the debt component would be 13 billion rupees," Aditya Jajodia, Chairman and Managing Director, said on Monday.

"For the remaing amount, 13 billion rupees would be funded through internal accruals and 1 billion rupees through equity," he added.

Under the first phase, a 2-million-tonne metalics plant, a cement grinding unit and 400 MW captive power plant would be constructed, he added.

"In the next two years, after the completion of the first phase of the plant, our capacity would increase to 3.25 million tonnes," he added.

The Kolkata-based company has recently raised 1.99 billion rupees through Qualified Institutional Placements (QIP) of shares for funding its ongoing projects.

"The funds raised through QIP will be utilised for completion of a ductile iron pipe plant and coke oven plant at Durgapur in West Bengal, development of mines allocated to the company and first phase of Purulia plant," Jajodia said.

Q2 NET REALISATION DOWN

The net relisation of Jai Balaji Industries for the July-Sept quarter is expected to be down by 30-35 percent on lower steel prices, said Raj Kumar Sharma, chief financial officer.

"The realisation has come down compared to corresponding period last year, but it has been more than made up by growth in volumes," he said.

The net relisation per tonne for TMT bars, sponge irons and billets stood at 26,000 rupees, 14,000 rupees and 22,000 rupees respectively, he said.

Jai Balaji currently produces 1.1 million tonnes of steel per year at its plants in the eastern states of West Bengal, Orissa, Jharkhand and Chattisgarh.

"We had a higher topline growth and our margins are comfortable now as the raw meterial cost has come down," Jajodia said.

(Reporting by Niladri Bhattacharya Editing by Sunil Nair)

(For more news on Reuters Money visit http://www.reutersmoney.in)

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