Shyam Metalics announces 40 MW additional captive power generation & 0.25 MTPA capacity expansion in steel products

Shyam Metalics and Energy Limited (SMEL) on Monday announced another strategic capacity expansion as outlined in the CapEx plans for Financial Year 2021-22 (FY22).

The company in a statement said, "We are pleased to announce that the Company has received "Consent to Operate" (CTO) from State Pollution Control Board, Odisha to increase captive power generation at its Sambalpur unit. Following the clearances, the capacity at the unit will increase from 118 MW to 158 MW. Across its units at Sambalpur, Jamuria & Mangalpur, the aggregate capacity will grow from 227 MW to 267 MW representing a 17.6 per cent increase. The incremental capacity is now operational."

In addition, the company has also received CTO from West Bengal Pollution Control Board for the scheduled capacity expansion at the Jamuria plant. This expansion will add 0.25 million tons per annum of incremental capacity across steel products. The aggregate capacities of Sponge Iron, MS Billet & Long Products are slated to increase by 7 per cent, 6 per cent & 10 per cent respectively.

Mr Bhushan Agarwal, Managing Director of the company said, "Following the recent sponge iron capacity expansion at our Sambalpur & Jamuria plants, we are happy to further announce increased captive power generation. As we expand production, our power demand increases in sync, hence increased captive power gives us a strategic cost advantage. We have the lowest cost of captive power in India and almost 80 per cent of our power consumption is met via captive generation. We incurred a capital expenditure of Rs 110 crores for the addition of the 40 MW capacity, a testimony to our focus on keeping costs in control. It gives us immense pride to share that the project came online much before its projected timeline of May 2022."

He further added, "As outlined in our expansion plan for the year, the expansion at Jamuria plant will also enable us to meet the increasing demand for our products. Our operational excellence in producing high-value long product structural steel cost-effectively will continue to give us an edge."

SMEL is a leading integrated metal producing company based in India with a focus on long steel products and ferroalloys. It is amongst the largest producers of ferroalloys, one of the leading players in terms of pellet capacity and the fourth-largest player in the sponge iron industry in terms of sponge iron capacity in India.

Shares of Shyam Metalics and Energy Limited closed at Rs 319.45 per share, down 0.33 per cent from the previous close of Rs 320.50 per share, on BSE today. The stock hit an intraday high of Rs 322.50 and an intraday low of Rs 315.60.