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Apr 18, 2013, 01.56 PM IST | Source: CNBC-TV18

Should get 24mt iron ore in next 1-2 years: Kalyani Steel

Hailing Supreme Court's (SC) decision of lifting mining ban in Karnataka, RK Goyal, managing director, Kalyani Steel said this move will give them access to more iron ore and will boost their operating capacity.

Hailing Supreme Court's (SC) decision of lifting mining ban in Karnataka, RK Goyal, managing director, Kalyani Steel said this move will give them access to more iron ore and will boost their operating capacity.

The Supreme Court on Thrusday lifted the one-and-a-half-year ban it had slapped on mines in Bellary, Chitradurga and Tumkur districts of Karnataka citing environmental violations. 

While restarting mining operations in Karnataka will take one month to two years, it will increase the availability of iron ore by around 24 million tonne over the next two years.

Also read: JSW Steel, Sesa Goa up after SC lifts mining ban

Below is the edited transcript of Goyal’s interview to CNBC-TV18.

Q: If you could give us your initial thoughts on the opening up of the mining in category B mines in Karnataka?

A: This will definitely help in larger availability of iron ore and with this, we will be able to operate our plants at much higher capacity. However, we are yet to see that how fast these mines are opened and when the ore comes to us. That will take anyway between three months to two years because most of the permissions have already expired. However, it is a very welcome decision and it should definitely help us.

Q: If you can, give us some ballpark figures on how much iron ore on an annual basis will the Karnataka state get now that these mines have opened up?

A: Karnataka’s total requirement is around 36 million metric tonne per year. Right now,  NMDC is already producing from its two mines- Kumaraswamy and Donimalai. If all the category A and B mines open, another 10 to 12 million tonne will be available.

Over a period of next one to two years, around 24 million tonne should be available. We are just waiting to see how soon and in what manner category C mines maybe opened.

Q: Can you tell me about your capacity utilisation- you said that it will go up. It current stands at around 60 percent or so how much do you think it could rise to?

A: We are currently operating at around 60 percent and much larger quantity of iron ore is available. We would like to ramp it up to 100 percent.

Q: What about the mining leases that have expired?

A: I think people will have to apply for renewal of the same, which may take time.

Q: In general, if you have to give us a time line by when this mining will actually start what kind of a time-line do you think- could it take a couple of months or could it extent in to a year?

A: It depends on the number of approvals which have expired. Some mines have already opened and they have already started putting the material in e-auction. Depending on the level of approvals which are required to be renewed, mines may take anything from one month to two years.

Kalyani Steels stock price

On October 30, 2014, Kalyani Steels closed at Rs 166.55, down Rs 2.1, or 1.25 percent. The 52-week high of the share was Rs 172.40 and the 52-week low was Rs 46.35.


The company's trailing 12-month (TTM) EPS was at Rs 17.10 per share as per the quarter ended September 2014. The stock's price-to-earnings (P/E) ratio was 9.74. The latest book value of the company is Rs 91.13 per share. At current value, the price-to-book value of the company is 1.83.

READ MORE ON  SC, minig ban, Karnataka, Kalyani Steels
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