JSL to raise Rs 500 crore to fund its Orissa Steel Project
O P Jindal Group, Jindal Stainless Limited (JSL), the India's largest and only integrated Stainless Steel manufacturer, has plans to raise Rs 500 crore through various possible routes to fund its upcoming Rs 5,700-crore stainless steel project in Orissa.
The board of directors of the company stated in a communiqué on Monday that it's considering issuance of securities on rights basis to raise funds.
The move has been planned due to shortfall in the liquidity, which further compelled the company to raise more funds for the Orissa plant.
According to reliable sources, the company would consider various options such as a rights issue, issuance of equity shares to qualified institutional buyers through qualified institutional placement or issuance of global depository receipts (GDRs) and FCCBS.
The company's Orissa steel plant was scheduled to get commissioned by mid 2011, but now, according to latest information it has got delayed by a year due to ongoing economic slowdown and unhealthy market conditions.
Presently, it has learnt that JSL instructed its overseas equipment suppliers to defer the delivery of the equipment by at least eight months on account of delay in the project.
A company official, familiar with latest situation informed that the construction work of Orissa plant is on and the plant will become operational only by mid-2012. The plant, once commissioned, is expected to produce 8 lakh tonnes of stainless steel every year.
Apart from setting plant in Orissa, the company would also setup a 250 MW power plant to meet captive power requirements of steel plant.