i Develop Stocks Advisory

SAIL, Jaypee form cement JV at Bokaro Steel Authority of India (SAIL) has inked a shareholder’s agreement with Jaypee Associates (JAL) to form a joint venture company for manufacturing cement at Bokaro. It is SAIL’s second JV for cement manufacturing, and the move is part of SAIL’s plans to diversify into cement production in a phased manner. The plant at Bokaro will come up in about two years at an estimated cost of Rs 405 crore. It will manufacture cement using slag generated by BSL’s blast furnaces. The new company — Bokaro Jaypee Cement (BJCL) — will set up a plant of 2.1 million tonne capacity. The equity participation by the two partners JAL and SAIL in BJCL will be in the ratio of 74:26. The initial authorised paid-up capital of the company will be Rs 50 crore. The agreement was signed by VK Srivastava, managing director of SAIL’s Bokaro Steel Plant (BSL) and SK Sharma, executive vice-chairman, JAL. While Mr Srivastava will be the first chairman of BJCL, RK Singh of JAL will be its first managing director. SAIL is also exploring formation of a similar joint venture company for utilisation of slag generated at Rourkela steel plant for which selection of a JV partner is underway. SAIL’s first JV cement company, Bhilai Jaypee Cement, was incorporated in April 2007 for setting up cement plants at Satna in Madhya Pradesh and Bhilai in Chhattisgarh. The plant, to be commissioned in 2010, will produce and market more than 2 million tonnes of Portland slag cement per annum.