Tata Steel has reached an understanding with Lloyds Metals & Energy Ltd to evaluate projects across mining to steelmaking in Maharashtra, signalling a pivot in the strategy for the century-old company going forward.

The board of Tata Steel also approved a slew of projects in the East, including expansion of Neelachal Ispat Nigam Ltd’s (NINL) capacity by 4.8 million tonnes at Kalinganagar, Odisha, and adding a demonstrative low carbon steelmaking unit of 1 mt in Jamshedpur, Jharkhand.

The company also approved at least two downstream units for value-added products targeted at the construction and automotive industries in Odisha and Maharashtra, respectively. The board also accorded approval to acquire a 50.01 per cent stake in Thriveni Pellets Private Limited (TPPL), which owns a 4 mt pellet plant in Odisha and a 212-kilometre slurry pipeline for ₹636 crore.

Tata Steel said the decision affirms the long-term growth strategy for India business in line with the stated objective of pursuing ‘prudent capital allocation and profitable growth’.

The company said it would prioritise investments in the volume growth, value-added downstream portfolio, mining assets and infrastructure to serve the needs of the India business and low carbon low capital intensity process technologies for sustainable steel making of the future.

However, the announcement of a broad spectrum of projects was not dovetailed with details of capital expenditure plan and timeline, indicating that they could be flexible depending on market conditions.

Western foray

As part of a non-binding memorandum of understanding with Llyods, Tata Steel will pursue setting up a 6 mt steel plant in Gadchiroli in two phases and also participate in the upcoming a 3 mt plant Llyods is building in the region.

If it materialises, this would be the first primary steelmaking facility in western India by Tata Steel, which has so far based its operations in Jharkhand and Odisha, which are endowed with raw materials such as iron ore and coal.

In contrast, two other private sector steel makers JSW Steel and AMNS India have their manufacturing bases in India’s South and West, the major consumption centres for steel. However, as JSW and AMNS are now venturing to the East, attracted by the proximity to raw materials, Tata Steel also appears to be firming up plans for the West.

In partnership with Llyods, Tata Steel will be able to service the demand clusters of the South and West, and focus on Maharashtra which aims to be a $1 trillion economy going forward.