GPH Ispat eyeing the top spot
GPH Ispat is gearing up to become the country's leading steel manufacturer as it will invest about Tk 1,700 crore for capacity expansion.
The Chittagong-based steel manufacturer's yearly production capacity of MS billet will reach 10.08 lakh tonnes from the existing 1.68 lakh tonnes, which will be more or less similar to that of the market leaders such as BSRM and AKS.
In line with the expansion, the yearly production of MS rod and medium-section products such as steel beam, angle, channel and flat bar will also increase by 6.40 lakh tonnes, in addition to the existing annual capacity of 1.20 lakh tonnes.
The company will also sign an agreement on Tuesday with Primetals Technologies Austria, a joint venture of Siemens and Mitsubishi Heavy Industries & Partners, for supplying machinery for the expansion.
The ultra-modern long-steel technology that GPH Ispat will use in the project will be the first of its kind in Bangladesh as well as in Asia, Managing Director of the company Mohammed Jahangir Alam said at a programme at La Vinci Hotel in the capital.
The state-of-the-art technology will not only ensure world-class products but also reduce the use of gas and electricity during production.
Per tonne power consumption in the new technology will be 300kw less than the traditional ones, while per tonne gas consumption will be 35cm less.
By using the new technology, GPH Ispat will be able to save 22.68 lakh megawatt power and 2.64 crore cubic metre gas every year, Alam said.
Carbon emission will also be 90 percent less than the World Bank's permissible limit, and 96 percent less than the Department of Environment's limit, he said.
The expansion project will create employment opportunities for 750 people directly, 300 on a contractual basis and 8,000 people indirectly.
Not only that, the average net profit will rise by around Tk 140 crore per annum over the first five years after the implementation of the expansion project.
The project will be implemented in two phases, and the cost will be arranged from the owners' equity and loans.
Net profit of GPH Ispat, which was listed on the stock exchanges in 2012, rose 5 percent year-on-year to Tk 29.28 crore in 2015.
Alam said per capita steel consumption in Bangladesh is only 30-32kg, in contrast to 57-58kg in India, 47kg in Pakistan, more than 200kg in Thailand and about 700kg in China and Korea.
“We are committed to enriching the country through infrastructural, social and economic development,” he said, adding that after the completion of the project they will contribute an additional Tk 245 crore to the government exchequer as corporate tax, value-added tax, customs duty and import duty.
On the premier bourse yesterday, each share of the company traded between Tk 46 and Tk 46.9, before closing at Tk 46.7.
Sponsors hold 59.65 percent stakes in GPH Ispat, institutions 14.43 percent and general investors the remaining 25.92 percent.
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