JSW Steel is mulling to reduce its capital expenditure by over half for the current fiscal in the light of turbulent times that the company is going through with a huge debt burden of over Rs 18,400 crore in the backdrop of sluggish demand for steel.
JSW Steel had originally planned a capital expenditure of about Rs 8,000 crore for the current financial year. However, after spending about Rs 2,000 crore in the first half of the fiscal, the company is likely to reduce the capital expenditure by over half for 2011-12.
The company's profitability in recent quarters has been impacted by the Supreme Court ban on iron ore mining in Bellary. The ban has forced the company to procure iron ore, the key raw material for making steel, at higher costs to keep its operations running, although at a lower capacity utilization.
