Shadeed Iron and Steel, part of the $12 billion Indian steel conglomerate Jindal group, plans to open its rolling mill for manufacturing re-bars by the end of the year.
This is part of further integration and the 1.4 million tonne per annum rolling mill is being set up with a capital expenditure close to $200 million.
However, the Sohar-based company is waiting for the market to recover for floating its initial public offering (IPO) on the Muscat Securities Market (MSM), N. A. Ansari, chief executive officer of Shadeed Iron and Steel told ‘Times of Oman’. “There is a major fall in prices of steel in the last nine months. We are waiting for the market to improve before we proceed (with the IPO),” he added.
Ansari said the purpose of the initial public offering is to install certain equipment for further reducing the cost of production and increase capacity. But the overall business scene of steel industry across the world is not that good. “Valuation of the company again depends on the market scene.”
He said the proposed issue will be by way of a dilution of stake by promoters and enhancement of the company’s capital. Shadeed Iron and Steel is a subsidiary of Jindal Steel and Power.
Ansari said the steel melting shop, which was commissioned last year with a capital expenditure of $400 million, produces steel billets and rounds.
The parent company has already invested more than $1 billion in acquiring the Omani plant (a direct reduction plant for producing hot briquetted iorn) from an Abu Dhabi group and for forward integration of a steel melting shop.
Located at Sohar Port, Shadeed Iron and Steel is the first integrated steel plant of a large capacity, which is helping Oman to meet its domestic demands in semi-finished steel — square and round billets and blooms, finished steel, rebars and wire rods. It also bears the potential for the development of ancillary industries to support many needs of the steel plant.
Jindal group is one of India's major steel producers with a significant presence in sectors like mining, power generation and infrastructure.