Bhubaneswar-based alloys firm Indian Metals and Ferro Alloys Ltd (IMFA) said that it will be able to fast-track its plans for the second phase of its expansion after it agreed to purchase metals major Tata Steel's ferro-chrome alloy manufacturing plant at Kalinganagar in Odisha, for Rs 610 crore.
In a recent interaction with Moneycontrol, the IMFA MD, Subhrakant Panda, said the company plans to reach a production capacity of more than 500,000 tonnes per annum (TPA) over the next three years, through both organic and inorganic expansion.
IMFA is implementing the first phase of its expansion plant at its own, greenfield project, also in Kalinganagar, that will add around 100,000 TPA, in terms of capacity and is expected to be commissioned in phases from June 2026.
The transaction with Tata Steel for the latter's Kalinganagar plant is expected to be closed in three months, and is being funded entirely through internal accruals, IMFA MD Subhrakant Panda said.
"We had a phase two expansion plan which has in-principle approval from the state government. What this acquisition does is it fast-tracks our expansion because phase two would have taken around three odd years to come in. That gets supplanted with this acquisition, which is for 100,000 TPA capacity," Panda said, during the interaction.
Laying out the company's expansion plans, Panda added that with its greenfield facility, as well as with the newly-acquired capacity, IMFA's production capacity till FY28 is expected to be around 544,000 tonnes. Production over the same period is expected to reach around 475,000 TPA.
IMFA is investing around Rs 900 crore to build its greenfield facility at Kalinganagar, and is spending around Rs 1,000 crore over five years to expand its mining capacities. Besides, the company, in diversification efforts, is also spending around Rs 150 crore to set up a 120 kilolitres (KL) per day ethanol plant.
With IMFA's revenues reaching around Rs 2,600 crore at the end of FY25, Panda expressed confidence that the top line may reach or cross the Rs 5,000 crore-mark as capacity and production ramps up, even as prices of ferro-chrome remain an uncertainty. Prices of ferro-chrome reached significant lows last year -- to around Rs 85,000 per tonne -- on the back of global over-capacity.
"Ferro-chrome prices corrected quite a bit in in the second half of the year...Prices have moved up in Q1 and Q2 of FY26, and we aim to realise the full benefit of current prices, of around Rs 1,15,000 to Rs 1,18,000 per tonne. The price is an undecided factor...but we do expect to cross the Rs 5,000 crore-mark for sure. I am not pessimistic about prices, because the dynamics are such that prices will remain in the current range," Panda, a former president of trade body Ficci (Federation of Indian Chambers of Commerce and Industry), added.
Ferro-chrome has extensive uses in the manufacturing of stainless steel, which remains a niche product in India and globally. Panda pointed out that production of stainless steel globally is a paltry 60 million TPA, compared to carbon steel, which is around 2 billion TPA.
However, Panda noted that infrastructure remains a source of demand, along with emerging applications, such as renewables.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
