Mumbai: Tata Steel, one of the world's top ten steel producers and India's largest, will spend Rs5,700 crore on expansion projects in the next financial year. Of this corpus, approximately 70 per cent (Rs3,700 crore) will be set aside for domestic expansion.
By August 2011, Tata Steel plans to expand capacity at its parent Jamshedpur plant to 10 million tonnes, up from the current 6.8 million.
Accordingly, the company will increase annual iron ore production within the country by 55 per cent, to 17 million tonnes, over the next two years. Increased ore production will help shield the Jamshedpur plant from fluctuations in raw material prices.
Domestic expansion costs will be budgeted at around Rs1,100 crore.
Overseas, the company is looking to develop iron ore and coal mines in Canada and Mozambique through joint ventures and developing a mini blast furnace for its Thailand subsidiary, Tata Steel Thailand.
The company is planning a rights issue to finance these plans and will utilise some of the money to repay portions of its debt.
The company and its European subsidiary, Corus, have a total debt of Rs26,946 crore.