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AL CIRCLE

Nalco to place high stakes on downstream aluminium business; plans for INR 5.52 billion worth project

EDITED BY : 2MINS READ

As Nalco’s chairman and managing director Dr. T. K. Chand say that the navratna company is always focused on constant value addition, this time it has decided to place high stakes on downstream aluminium business. After co-developing a downstream park with Odisha Industrial Infrastructure Development Corporation (Idco) and planning joint ventures with foreign players- Almex and Rusal, the company has pledged an investment of INR 5.52 billion on a major downstream complex at Kamkhyanagar in Dhenkanal district. The entire fund for the project will come from Nalco’s internal accruals, according to the report.

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Dr. T.K. Chand has also said “There is a huge demand for value added aluminium products. Apart from catering to the demand, product diversification will also shore up our margins.”

As of now, 188 acres of land has been identified for the planned downstream complex. However, the land allotment is subject to appraisal by Industrial Promotion & Investment Corporation of Odisha Ltd (Ipicol). The projected time to finish the project is 48 months from the date of taking land possession.

Once completed, the project is expected to have a total production capacity of 170,000 tonnes per annum, wherein it will produce aluminium foils, rolled products and extrusions. This complex, on completion, is also expected to have a potential to generate employment of around 1761 people, both direct and indirect.

Nalco, with this new project, is envisioning marking a new beginning of a strategic shift in the company’s strategy. An analyst says, “Nalco is possibly looking for a safe bet in aluminium downstream products. Volatile prices and currency fluctuations are a worry for metal focused companies though Nalco with a huge cash surplus and robust export earnings offsets that risk.”

The state-owned company also recently announced an investment of INR 1.31 billion on a wire rod manufacturing unit at the aluminium park at Angul, with a total production capacity of 40,000 tonnes of alloy grade material. The company has designed the unit to meet the growing demand for aluminium in the power sector, especially power transmission.


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EDITED BY : 2MINS READ

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