Essar plans 10 MT steel business; expects turnover of Rs 40,000 cr

Essar's Hazira port has ramped up capacity to 10 million tonnes per annum at a cost of over Rs 35,000 crore.

This fully integrated 'mine to market' facility claims to be one of the lowest cost steel producers in the world with plants running on a myriad different technologies including a DRI plant, a blast furnace and a plant using corex technology for making iron which is then used in making steel.

The next two years will be spent consolidating these operations says the heir to the Essar empire Prashant Ruia who expects an annual turnover of a whopping Rs 40,000 crore once the full capacity utilization is achieved.

But are these plans ambitious even as steel makers face headwinds due to growing uncertainty on raw materials, a slump in steel demand and sluggish reforms. The company though is guarded about its future expansion plans as it is not making any ambitious announcement with regards to future capacity addition.

A relisting through an IPO could however be on cards sometime in the next 2 years.

If Essar Steel does indeed hit the bourses, it will be a force to reckon with with 14 million tonnes of capacity and fully integrated operations.

But more immediately the challenges for Indian steel makers are plentiful and tiding over them in the next 2 years will be crucial.