Mumbai, Dec. 2: Tata Steel is paring its costs and rejigging its capital expenditure plans.

The steel giant — which is ranked as the sixth largest steel maker in the world — is planning to save Rs 300 crore over the next five months through cost-cutting measures.

It also plans to focus on projects in Jamshedpur and Orissa from which it expects higher returns and soft-pedal its greenfield ventures and conserve on its cash reserves.

However, the company has no plans to reduce steel production in the country. At the same time, it is planning to secure raw materials such as iron ore to serve the requirements of Corus Group Plc.

“We have also re-fashioned our capital expenditure plans giving higher preference to high-return projects like the Jamshedpur and the Orissa projects,” Tata Steel managing director B. Muthuraman told reporters here today after the company declared its consolidated half yearly numbers.

On a consolidated basis, Tata Steel reported a second-quarter profit of Rs 4,703.64 crore against a restated profit of Rs 1,524.35 crore in the corresponding period of last year.

During the period ended September 30, net sales stood at Rs 44,198.97 crore (Rs 32,441.61 crore). In the first half, profit was placed at Rs 8,672.55 crore (Rs 3,955.85 crore).

“We are delaying many of the other projects to ensure that our liquidity position continues to remain strong. We also plan to secure our raw material ownership faster than what we had planned,” he said.

Muthuraman said the company intended to step up the pace of work on its Jamshedpur expansion which would be completed by the end of 2010 against the target of early 2011.

In the case of greenfield projects, he added that the land acquisition process had yet to be completed.

In Jharkhand, Tata Steel proposes to invest about Rs 42,000 crore for a 12-million-tonne integrated steel plant. In Orissa, it intends to spend nearly Rs 22,000 crore on a 6-million-tonne unit.

The Tata Steel managing director said the company had already achieved cost savings of around Rs 450 crore against a target of Rs 900 crore for the year.

“For the rest of the year, we are committed to a further savings of about Rs 300 crore through improved operational efficiencies, revenue and overhead costs,” he added.