JSW Steel Ltd.

JSW Steel, facing continued iron ore shortages, has put on hold its Karnataka’s Vijayanagar plant expansion plans. The company earlier had planned to expand its Vijayanagar capacity, which presently stands at 10 MT per year, by 2 MT. The Rs 2,695-crore expansion was proposed to be completed in 2013-14. For funding the expansion, the company was planning to tie up a debt of Rs 1750 crore, with the remaining requirements being funded from its cash reserves.

The company, headed by Sajjan Jindal, for a year now, has been struggling to run its 10 MT Vijayanagar plant at its optimum capacity. The iron ore supplies to the Vijaynagar plant have been disrupted since July after the Supreme Court imposed a ban on iron ore mining and transportation in Bellary on environmental grounds.

Owing to the shortages of iron ore, JSW has been operating the plant at 80% or lesser capacity and the current capacity utilization is 75-77%.  Despite the crisis, the company has showcased confidence of reaching its production guidance of 8.5 MT for the current fiscal. For the first 11 months of the current fiscal, the company has produced about 7.80 MT of steel.