India’s largest aluminium extruder Jindal plans to invest INR 150 crore

The largest aluminium extrusion company of India, Jindal Aluminium is considering investing INR 150 crore-odd over two years, as it counts to initiate on-stream new capacities across its two verticals i.e. extrusions and rolled products.

The aluminium downstream company stated that it will boost up capacities by around 50% primarily across the extrusions vertical.

Jindal aluminium’s existing capacity in the extrusions segment is 125,000 tonnes per annum, whereas for the rolled products category the production capacity stands at 50,000 tonnes per year.

Pragun Jindal Khaitan, the Vice Chairman and Managing Director, Jindal Aluminium Ltd, stated, “Investments towards incremental capacity addition would be funded through internal accruals.”

However, it was also highlighted that of INR 100 crore-odd investment, a portion will go towards de-bottlenecking at the existing unit in Bengaluru, while the major chunk will be spent as CAPEX in augmenting capacities at the recently acquired Indo Alysus Ltd plant from Hydro. The facility in Bhiwadi, Rajasthan which Jindal acquired recently by investing INR100 crore has a production capacity of 15,000–18,000 tonnes per annum. Now, the plan is to expand by an additional 32,000 tonnes per annum, to 50,000 tonnes per annum over the next few quarters.

The production capacity at the rolled products unit - with the incorporation of the fifth caster –occurred in 2019. In the next 12-18 months two more casters are anticipated to be added for INR 50 crores, consequently elevating the total production capacity up to 75,000 tonnes per annum.

The Managing Director added, “We are open to Greenfield capacity expansion in the future. The Indo Alysus acquisition will bring us closer to customers in North India – one of our larger markets. We are targeting to close FY22 at INR 3000 crore.”

As the additional capacity becomes operational, a 15% growth is anticipated in the top-line of the company, 20% insertion to aluminium extrusion segment top-line, as extrusions shoulders for 65% of its top-line and rolled products grab the remaining 35%.

“Jindal Aluminium is witnessing a CAGR of 8-10 per cent, in line with the industry. We do not plan to get into mining. We procure aluminium from the primary players. The base price of primary aluminium is determined by London Metal Exchange rates,” Pragun Jindal added.