Tata Steel To Invest Rs 12,000 Crore On India & Europe Operations This Year, Says CEO T V Narendran

Tata group¡¯s oldest company Tata Steel has planned a massive capital expenditure of Rs 12,000 crore on its India and Europe operations during the current financial year of 2022-23, its CEO T V Narendran has said.

On Tata Steel's capital expenditure plans for FY 2022-23, CEO Narendran, who is also the Managing Director (MD) of Tata Steel, said in an interview with PTI, "We have planned for about Rs 12,000 crore of capex for the year of which about Rs 8,500 crore will be spent in India and the balance in Europe."

In India, the focus will be on the Kalinganagar project expansion and mining activity, and in Europe, it will be focused on sustenance, product mix enrichment and environment-related capex, CEO Narendran said.

fortune india

Tata Steel is in process of expanding the capacity of its plant in Kalinganagar, Odisha to 8 MT from 3 MT. In addition to this, Tata Steel will be spending about Rs 12,000 crore on inorganic growth in India in the NINL acquisition, Tata Stee¡¯s CEO said.

Tata Steel, through its wholly-owned subsidiary Tata Steel Long Products Limited (TSLP), had also completed the acquisition of Odisha-based one Million Tonne Per Annum (MTPA) steel mill NINL for a consideration amount of around Rs 12,000 crore earlier this month.

Elaborating on the European business, CEO said it has been divided into the Dutch business and the British business.

"This allows us to run Tata Steel as one integrated company with five major sites, three in India and two in Europe. This brings greater focus to each of our operating sites. The European sites have been tasked with becoming self-sufficient," he mentioned.

According to CEO Narendran, Tata Steel produces close to 20 million tonnes in India.

On the duty-related measures taken by the government, Narendran said "I fully understand and appreciate the compulsions of the government in taking actions that they did to control inflation. However, in the medium to long-term, we should actively be positioning India as one of the best places to produce steel in the world."

Outlook Of Steel Sector

On the outlook for the steel sector, the CEO said the first half of the financial year was disrupted due to the fallout of the Russia-Ukraine war, the COVID-related shutdowns in China, and the imposition of export duty on steel in India.

"I expect the second half of the financial year to be more positive than the first half as I expect the demand growth for steel in India to be strong based on the continued focus on infrastructure spend.

indiatimes

"Steel pricing would have also stabilised after absorbing the impact of the export duties. I also expect China to recover from the economic impact of the COVID shutdowns in the first half. So overall I am positive about the prospects of the industry for the rest of the year," CEO Narendran said.

Impact Of Russia-Ukraine War

CEO Narendran, who is also part of the Executive Committee of the apex steel body World Steel Association said the Russia-Ukraine conflict has impacted the global geopolitical order and the global economic order and hence the steel industry in multiple ways.

"On the supply side input costs like cost of coal and cost of gas have been significantly impacted by the war. Russia and Ukraine together used to export about 30 to 40 million tonnes of steel into the global markets and that supply has also got disrupted. Inflationary pressures arising out of the war have disrupted plans for government infrastructure spending across the world," he said, as per PTI.

Also Read: Tata Technologies To Become First Tata Group Company To Launch IPO In 18 years

For the latest and interesting financial news, keep reading Indiatimes Worth. Click here.