NMDC steel plant commissioning, demerger delayed to FY22-end

As with all other customers who offtake iron ore, NMDC has a long-term agreement for the steel plant and iron ore would be supplied at arm’s length pricing.

The commissioning of NMDC’s 3 million tons per annum steel plant is further delayed due to non-arrival of foreign expats amid Covid-19.

The company has spent ₹18,600 crore till now and the plant is now expected to be commissioned by FY22-end, Chairman cum Managing Director, Sumit Deb told analysts during a conference call following FY21 results.

NMDC will seek Board approval on July 31 for draft demerger plan of steel plant. Thereafter, various statutory permissions would be required; the demerger is likely to be completed by Q4 of FY22.

Of the total capex of ₹21,300, another ₹3,000 crores is pending, he said.

“Total capex for this year is around ₹3,700 crores and for the steel plant would be around ₹1,500 crores and we are looking at commissioning the plant in Q3,” Deb said.

“We expect the board to sort of give its approval to the draft demerger scheme by July 31. Once that happens then we take it to SEBI and Competition Commission of India and come back and then modify if they have something to say,” he said.

This could take anything between 100 and 160 days depending on how much time Securities and Exchange Board of India and other bodies take.

“So, if I start from August 1, it could be anything within 100 days to 160 days from August,” Deb said.

Steel project

The commissioning of the Nagarnar steel plant would be integrated, it starts with the coke ovens and then heating out the coke ovens and then it ends with the rollout of the coil.