India’s Tata Steel Limited will invest an estimated $795 million in equity in its subsidiary Neelachal Ispat Nigam Limited (NINL) for its expansion plan in long products, company sources said on Friday, March 29.
The investment in NINL will be made over a period of two years, a long product producer acquired through the government’s disinvestment program in early 2022.
After acquisition of the state-run entity, Tata had focused on restarting the plant and taking it to the existing capacity of 1.1 million mt per year. In the next phase, the company plans to expand NINL’s capacity by another 4 million mt per year and take it up to 5 million mt per year, the sources said.
“Considering the underlying objective of optimising the funding structure in NINL by way of long-term equity support and meeting the capex requirements towards the expansion plan of NINL, the company may invest in NINL through equity infusion over the period of the next two years from the date of approval of the shareholders,” Tata Steel informed shareholders.
Apart from the steel capacity of 1.1 million mt, NINL also has a captive power plant of 62MW and captive iron ore mines of 90 million mt.
The facility is situated in close proximity to Tata Steel’s steel plant at Kalinganagar, Odisha, where a 5 million mt per year capacity addition project is nearing completion.