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Tata Steel capex likely to touch 9,000cr in FY20
Tata Steel Ltd is expecting its capex during the current fiscal to touch the Rs 9,000-crore mark, company sources said.
The steel major, however, will take a cautious approach at the capital allocation for the next financial year, they said.
The steel maker had, earlier, said that it would revise the planned capital expenditure for the 2019-20 to Rs 8,000 crore from Rs 12,000 crore for the group.
In the third quarter, company had spent about Rs 2,777 crore, taking the total capital expenditure to Rs 7,762 crore during the first nine months of the current fiscal, sources said.
The company had invested around Rs 1,367 crore for its India operation, including about Rs 935 crore expenditure for its Kalinganagar plant in Odisha, they said.
"A part of the capex is committed to Tata Steel Europe. Thus, the actual spending will be higher. By the year-end, the capex will be around Rs 9,000 crore.
"But (we are) looking at the capital allocation very sharply for the next year and it would depend on how the markets play out over the next few months," sources said.
They said the company has prioritised the pellet plant and the cold-rolling mill.
"The pellet plant will help us to bring down costs while the cold-rolling mill to add value to the product mix...We maintain our target to commission the same in about a year from now," the company had informed the analysts.
For other projects, the steel maker will phase it out depending on the market conditions, soures added.