Mukand Group investing $109 million to expand steel capacity

Tuesday, 31 July 2018 20:45:23 (GMT+3)   |   San Diego

According to a recent press release, the Mukand Group is set to invest Rs 750 crore (US$109 million) to increase steelmaking capacity in southern India. It plans to increase output to meet the increasing demand from carmakers and engineering companies in the region.

The expansion plans include Rs 600 crore (US$88 million) that will be spent by its subsidiary joint venture Mukand Sumi Special Steel. The JV plans to set up a new mill in Karnataka’s Hospet. Mukand Sumi Special Steel, owned 49 percent by Sumitomo Corporation, and has already acquired 100 acres adjoining Mukand’s existing plant at Hospet for the proposed construction and commissioning of a new wire rod mill with finishing facilities. Another Rs 150 crore (US$ 22 million) will be invested at its existing unit to support the growing demand for specialty steels from automotive and engineering clients.

According to Rajesh V Shah, co-chairman of Mukand, the firm is exploring options for increasing steel capacity at the site to around 1.5 lakh mt annually (150,000 mt). The new investments are expected to add an additional 4 lakh mt annually (400,000 mt) capacity by 2020,”

The combined manufacturing capacity of Mukand from its facilities at Thane, Maharashtra, and Hospet is presently 6 lakh mt annually (600,000 mt) of special and stainless steel long products. “The capacity utilization between our plants in 2017-2018 was 75-80 percent, which, we hope, will rise to around 90 percent in 2018-2019,” Shah added. Shah also noted that Mukand is not presently looking at acquisitions to drive growth.

Mukand manufactures more than 400 grades of special and alloy steels widely used in the automobile and auto component industry for products such as fasteners, bearing transmissions, crankshafts, steering components, and suspension springs.

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