Sesa Goa to invest Rs400 crore in new mines, infrastructure
07 November 2008
Sesa Goa Ltd, the country's largest exporter of iron ore will invest about Rs400 crore over the next two years to develop mines and infrastructure. The company also expects to grow at 30 per cent in the current financial year despite a near 50 per cent drop in the prices of iron ore.
''We are expanding our capacity by 25-30 per cent. This is despite the fact that prices for some fines have halved in recent times. We want to be consistent with the volume growth," managing director P K Mukherjee said on the sidelines of a mining conference.
Sesa Goa, in which Anil Agarwal-led Vedanta Group Plc holds a majority stake, said it was also planning to acquire iron ore mines both within and outside the country, but did not give any details.
While the capacity expansion programme was well on track, Mukherjee said the the company was focusing on volume.
For the year ended March 2008, Sesa Goa reported a 14 per cent jump in iron ore production at 12.4 million tonnes. But a fall in prices is expected to make a big dent in the company's bottomline this year.
''The price fall was inevitable, but the pace at which it has come down has shaken all. There will be an erosion in profitability," Mukherjee said. ''But, we were never in the red and will not come in the red this year also, as we are the lowest cost producer of the mineral," he added.