May rework the second phase in tune with market conditions
The company’s order book now stands at
Rs. 2,800 crore.
KOLKATA: At a time when land acquisition and project commissioning is assuming major importance, the B. M. Khaitan group company McNally Bharat Engineering Ltd (MBEL) has commissioned the first phase of its greenfield project at Asansol in West Bengal on schedule.
Company officials said that the first phase, comprising a forging unit, has been set up with an investment of Rs. 27 crore on 25 acres acquired from the Asansol Durgapur Development Authority (ADDA). MBEL, which is now the focus company within the diversified B. M. Khaitan group, is into manufacturing and turnkey projects. It has manufacturing units in Kumardhubi and Bangalore.
However, company sources said that the second phase of the project might have to be reshaped in tune with the emerging market conditions.
“We have applied for another 20 acres which we may get by the end of this year, but we may have to rework the project like changing its scale of operations depending on market situation,” sources told The Hindu. Implementation is not expected before 2011.
On the funding of the Rs. 27-crore project, sources said that the company had raised external commercial borrowings in October 2008 to part-fund the project.
Internal accruals accounted for a small portion.Sources said MBEL’s order book now stood at Rs. 2,800 crore and was on target.
The brownfield modernisation and expansion scheme of Steel Authority of India Ltd (SAIL) has provided a degree of sustenance to the company.
“SAIL’s modernisation programme has translated into major orders for us,” sources said.
Recently, it won a domestic bid for another SAIL unit. This was IISCO’s water supply system for its continuous cast plant and its blast furnace at Burnpur.
The order is valued at Rs. 115.90 crore, including taxes and duties.
The target date of completion is 18 months from effective date of contract.