The Jain group plans to build a 1,000MW power plant and a 5mt steel mill at Raghunathpur in Purulia. “We have submitted a detailed project report for these two plants to the Bengal government and we hope to sign a memorandum of understanding within this fiscal,” said Manoj Kumar Jain, chairman of the group, which was incorporated in 2001. The group’s wholly owned subsidiary, Jain Steel & Power, which is setting up a 0.5mt integrated steel plant at Jharsuguda in Orissa, will build the proposed power and steel plants at Raghunathpur. “We have already identified the land where the projects will come up and will start land acquisition as soon as we get the government’s approval,” Jain said.
The Purulia project will involve an investment of Rs 5,000 crore in the first phase, Jain said. “A Dubai-based financial institution has agreed to invest in the steel and power projects,” he added. “The construction of the Rs 400-crore Orissa project, comprising a sponge iron unit, a power co-generation plant and a steel billet mill, is almost complete and it will go on stream from March this year,” he added. Jain Energy, another subsidiary of the group, signed a memorandum of understanding with the Chhattisgarh government on February 1 for a 1000MW coal-based power project in the Janjgir-Champa area. “Total investment for the power project has been estimated at Rs 5,000 crore, of which nearly Rs 3,500 crore will come as borrowings from banks and financial institutions and the remaining Rs 1,500 crore will be funded as equity capital,” Jain said.
According to him, the company has already tied up with banks and financial institutions for the loan. “As for the equity capital, part will come from the group’s internal accruals and the rest will be raised through a public issue by diluting the promoters’ stake in Jain Energy,” Jain said. The initial public offering (IPO) of Jain Energy will be made sometime in the first half of the next calendar year.
The company has applied to Coal India Limited for the supply of fuel for its Chhattisgarh power project, which will be completed in 2011. But before diluting the promoters’ stake in Jain Energy, the group is planning to tap the capital market in March-April this year with a maiden offer in flagship Jain Infraprojects, set up in 2001 to undertake road construction and civil engineering projects. “We (promoters) are planning to sell our holding in Jain Infraprojects up to 25 per cent of post-issue equity capital and float the IPO in March-April this year,” Jain said.
Source: The Telegraph