State-owned trading firm MMTC said it will invest about Rs 6,000 crore to double the capacity of Neelachal Ispat Nigam (NINL) in the next four years.

"We have decided to double the hot-metal capacity of 1.1 million tonnes in the next four years in Neelachal Ispat in the first phase," MMTC Chairman and Managing Director Ved Prakash said here today.

Speaking on the sidelines of FIMI organised summit, he said the steel plant will commence production from December.

MMTC holds 50 per cent stake in Neelachal Ispat while, NMDC Ltd and Odisha Mineral Corp, have 12 per cent and 28 per cent, respectively.

Prakash said Neelachal Ispats board have already given in-principal approval for the expansion to 2.2 million tonnes hot-metal capacity.

"We are waiting for the techno feasibility study, which is expected to be ready in the next 45 days. All the three major promoters have agreed in-principle for the expansion plan. The total investment for doubling the capacity would be in the region of Rs 6,000 crore," Prakash added.

MMTC said it may convert its Rs 1,000 crore working capital loan into equity toward its share of fresh equity of Rs 2,000 crore requirement towards the expansion.

In the second phase, the capacity of Neelachal Ispat would further be increased to five million tonnes, Prakash said.

Meanwhile, buoyant from gold business and higher coal imports, MMTC is eyeing a revenue of Rs 20,000 crore in the current financial year, Prakash added.

"Our coal imports for the year (Apr-Mar) is expected to be in the region of 8-10 million tonnes. We have recently entered into an agreement for exporting iron ore to Japan and Korea. We are also expecting a higher business from gold medallions. All these should drive our revenue to Rs 20,000 crore," he said.

MMTC had posted a Rs 18,241 crore top-line in 2014-15 from around Rs 25,000 crore in 2013-14.

Speaking about gold medallion, Prakash said the agency will finalise a national distribution network in a fortnight after dialogues with banks like SBI, ICICI and Department of Post.

Once we have a distribution network, then we will begin selling the gold medallions, he added. PTI BSM CR PRB ABK

 

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