New Delhi: Steel Authority of India (SAIL) has hiked its planned expenditure during the 12th Five-Year Plan by 33 percent to Rs 65,000 crore on modernisation and expansion.
"The Ministry is directly responsible for investment of public sector units which we will expedite. The 12th Plan target of Rs 45,000 crore for SAIL has been increased to Rs 65,000 crore," Steel Minister Beni Prasad Verma told PTI.
SAIL had pegged Rs 45,000 crore outlay on modernisation and expansion for the 12th Plan Period ending 2017, including Rs 14,500 crore during the current fiscal. During the 11th Plan, its capital expenditure was Rs 40,321 crore.
"So, SAIL now has to come up with a new plan for the 12th Plan so that it can make at an additional investment of Rs 15,000-20,000 crore," Verma said.
The state-owned steel maker is in the midst of expanding its crude steel production capacity to 21.40 mtpa (million tonnes per annum) from 12.84 mtpa now with Rs 72,000 crore investment.
It also plans to invest Rs 1,31,000 crore to raise capacity from 21.4 mtpa to 45 mtpa.
Besides capacity addition, SAIL requires investments for eliminating technological obsolescence, enriching product-mix, developing mines and matching infrastructure facilities, SAIL Chairman C S Verma had written in a letter to shareholders before the company's annual general meeting last week.
He had said the company also needs funds for modifying its capital assets, essential to maintain market competitiveness and meet the challenging needs of customers.
SAIL has been meeting its investment needs mainly through internal generations and as a result its debt-equity ratio has gone down to 0.41:1, as on March 2012.
"To maintain its current dominance in the domestic market and to meet future challenges, SAIL is working on a long-term strategic plan "Vision 2020", which will steer the company towards meeting its objectives of achieving profitability through organic and inorganic growth," the SAIL chairman had said.
First Published: Sunday, September 23, 2012, 15:31