Search News

RATAN Jindal-led JSL (formerly known as Jindal Stainless) is exiting its joint venture (JV) with Indonesian mining firm PT Antam Tbk a year after the two players got together to make ferro nickel and stainless steel slabs in Indonesia, said a top JSL executive.
Nickel is a key input in ferro nickel, which in turn is used in producing stainless steel.

The project, which involved a 20,000-tonne nickel smelting plant and 3 lakh tonne stainless steel slabs plant, could have absorbed investments of $1.2-billion. PT Antam, which has interests in ferronickel, nickel ore, gold, silver and bauxite, owned the majority stake in the 55:45 JV with Delhi-based JSL. The venture was set up in May 2008. "Steep fall in nickel prices has made the project unviable due to huge costs involved. Moreover, raising funds is a major issue," said JSL director (finance) Arvind Parekh.

He added nickel prices were hovering between $20,000-24,000/tonne when the project was conceptualised. But nickel prices have more than halved since then which dilutes the expected profit margins and thereby enhances risk.

As per the joint venture agreement, the ferro nickel and stainless steel slabs units were to largely serve the South East Asian markets. JSL also had plans to import a part of the material produced by the venture into India to churn out processed finished products. So far, JSL has invested $5-million in the project.

The Indian firm intends to do away with the partnership and has started scouting for possible buyers. "Some Indonesian and Chinese players have shown interest in buying out our stake and we have initiated talks with them," Mr Parekh said adding that JSL will continue to import nickel from PT Antam even after the separation from the venture. At present, JSL has installed capacity to produce 7.2 lakh tonne of stainless steel in Hissar and imports around 15,000-18,000 tonne of nickel every year.

The company is also in the process of setting up a Rs 5,700-crore stainless steel plant in Orissa, for which it is planning to raise Rs 500 crore through various possible routes including a rights issue or issuance of global depository receipts.

Find Lawyer / Law Firm

Extradition Law in India

Every time an offender stealthily leaves India to take refuge in another country, the Government of India starts all over again with its strategy of bringing him back to the nation to make him stan More

Legal Consultation - Consult over phone, chat or send questions

Helplinelaw can set up your session with quality and experienced lawyers to discuss and resolve your legal matters. You can avail consultation in form of sending questions, phone call or webchat discussion  More