JSW Steel is aiming to nearly double its capacity to 50 mln tons in the next three years, chairman Sajjan Jindal said. The company is also aiming to shift to renewable sources of power to fire the entire 50 mln tons of production, Jindal said speaking at an event organized by the Bombay Chartered Accountants Society.
“Today, at JSW Steel we are at 28 mln tons capacity and next year we will be 37 mln tons capacity and (in) three years’ time we will be 50 mln tons capacity,” he said.
He said the company is also paying a lot of emphasis on sustainability and has devised a plan to completely shift its power usage to renewable sources.
“At JSW Steel, we would probably be the first steel company in the world which will be 50 mln tons capacity and operate 100 pct on renewable power, that is the plan we are doing,” Jindal said.
Jindal said as the company goes ahead with its planned capacity additions, it is already adding renewable power capacities in a departure from the conventional system of depending on fossil fuels like coal.
The Indian steel manufacturing landscape has come a long way and has the potential to be the supply centre for catering to world demand, Jindal said.
He recalled that in 1994, JSW Steel had approached lenders like ICICI with a proposal to erect a 1.2 mln ton capacity plant while Tata Steel had a capacity of 2 MT. In about three decades, India is home to steel companies having 40-50 MT capacities, he added.
Comparing the Indian steel landscape with China, which is at present the largest supplier of steel to the world, Jindal said at present, Chinese companies have an operating profit margin of 2-3 pct, while the same ranges between 15-25 pct for Indian companies.
India has iron ore reserves, while China is home to coking coal, Jindal said, adding that India’s position is more advantageous from a raw material perspective because the industry needs over 2 tons of ore to produce a ton of steel while the reliance on coking coal is far less at 500 kg per ton.
India, however, is a “laggard” when it comes to spending on research and development, he rued.
The local steel industry can cater to the world’s steel demand, Jindal said, adding that JSW Steel is adding capacities with an eye on the world market.
India will fill the gap of being the supplier to the world looking for options beyond China, Jindal said, asserting that countries like Vietnam or Malaysia cannot take that position.
