Mumbai, Nov. 21: Mitsui & Company of Japan will pick up a 10 per cent stake in Indian Steel Corporation Ltd (ISCL), a project being put up by the Ruchi group to manufacture cold-rolled steel and colour-coated steel products. Mitsui, one of Japan’s largest trading company, has inked the investment agreement with the Ruchi group last week.

Though the magnitude of Mitsui’s proposed investment in the Indian company has not been disclosed, this will be the Japanese trading company’s first equity investment in the Indian steel products sector.

Indian Steel Corporation, located near Kandla in Gujarat, is being set up at a total cost of Rs 600 crore and will have a production capacity of 4 lakh tonnes of cold-rolled steel and 2.70 lakh tonnes of galvanised products, including colour-coated steel. The project is expected to be fully operational by 2007 and will cater to the booming construction and auto sectors in India.

Mitsui is one of Japan’s largest trading companies with a total revenue of $32.95 billion and has a variety of business interests such as metal products and minerals, machinery, electronics, chemicals, energy, consumer products and services, logistics and financial markets.

With the commissioning of Indian Steel Corporation, the Ruchi group will add a fresh capacity of half a million tonnes to its existing steel processing capacity.

“With increasing activity in the Indian construction and sustained buoyancy in the segment, we are bullish on the domestic demand for steel in the near future,” said Umesh Shahra, managing director of Indian Steel Corporation.

ISC chairman Kailash Chandra said, “We are delighted to have Mitsui as an equity partner in our new project.”