Capacity building involves various strategies that are designed to make a business more adaptive and responsive, thereby enabling it to be more successful in today’s challenging conditions. JSW Steel’s capacity building strategies strengthen the organisation’s ability to be better everyday. Towards this end, it has taken up capex projects across all its facilities, along with creation of assets abroad to to serve its customers in the prevailing scenario of trade barriers and other restrictive regulations. A key consideration while executing such projects is that all equipment should have best-in-class environmental attributes and should be able to meet global emission standards.
“India has set a vision to become a US$5 trillion economy in the next five years and steel will be the backbone of this growth story. We reckon that it is imperative that the nation be selfsufficient in raw materials that help create the necessary infrastructural framework for growth. In line with this demand projection, JSW Steel has accelerated capacity upgradation and modernisation projects to produce innovative and high-quality steel products that eliminate the need for imports. As a leading steel manufacturer, we remain committed to meet India’s increasing steel demand in a safe and sustainable manner.”
Dr. Vinod Nowal
Deputy Managing Director
JSW Steel has acquired the steelmaking facilities of Acero Junction Inc. with the aim of expanding its global presence and locally providing steel-related products to the American market. Going forward, the facility is expected to be evaluated for manufacturing capacity expansion of up to 3 MTPA.
Integrated facility, with 3 MTPA finishing capacity
The acquisition of the finishing facility in Piombino, Italy from Aferpi enables JSW Steel to cater to the European market. Demand for sectors such as high-speed rail is rising in Europe and this acquisition will position JSW Steel as a reliable supplier of steel and related products in the region.
Joint controlling stake
JSW Steel aims at deriving synergies from MIEL in terms of added capacity in special steel manufacturing. Further, the strategic location of MIEL and its assets will help JSW Steel deepen its presence in the northern and eastern markets of India.
JSW Steel’s key projects such as the expansion of crude steel capacity at Dolvi Works from 5 MTPA to 10 MTPA, capacity expansion of CRM-1 complex at Vijayanagar Works, modernisation-cum-capacity enhancement at downstream facilities of JSW Steel coated products and strategic cost savings projects have progressed satisfactorily for commissioning as per schedule. A key consideration while executing such projects is that all equipment should have best-in-class environmental attributes and should be able to meet European emission standards.
The work pertaining to revamping and capacity upgradation of BF-3 at Vijayanagar is progressing satisfactorily. After taking into consideration strong domestic demand conditions, and with a strategic intent of ensuring no volume loss for FY 2019-20, the Company has decided to defer the shutdown of BF-3 at Vijayanagar for upgradation. The plan will be implemented at a later period after the new BF at Dolvi gets commissioned by March 2020 and starts ramping up. All other projects at Vijayanagar such as Steel Melting Shop (SMS), caster and wire rod mill will continue towards completion as per original schedule of March 2020.
Capex plan till FY 2021-22
With a cumulative cash outflow of `14,371 crore in the last two years, the Company plans to spend about `34,300 crore over the next two years with some spillover to FY 2021-22. With this, the Company is now implementing a cumulative capex spend of `48,715 crore (net of capex projects put on hold during the year) over FY 2017-18 to FY 2020-21.
These projects will be planned and funded by a mix of debt and internal accruals. The intended plan is expected to improve crude steel capacity by 27% from 18 MTPA to 24 MTPA and VASP capacity by 44% from 5.6 MTPA to 8.4 MTPA.
Impact on capitals with respect to capex
Moving in line with the change in market demand, the Company is focussing on value-added products such as galvalume and colour-coated products. This has ensured that it has a better product mix than its industry counterparts, owing to cutting-edge technology provided by JFE.
JSW Steel places quality at the core of all its activities. As an outcome of this effort, JSW Steel Vijayanagar facility was awarded the coveted Deming Prize, the highest honour for organisational quality in the world. The Deming Prize is given to an organisation for managing continuous improvements across all its functions.
Parameters covered in the assessment for the Deming Prize
Indigenously developed the TQM framework and governance structure
Indigenously developed capability development framework for enhancing human resource capability, eventually leading to enhanced motivation levels of employees
New product development system and technologies to ensure reuse and recycle of water and waste
Proactive deployment of CSR activities to bring benefit to the local society under the policy "create economic value by creating social value"
Highly appreciated TQM initiatives
Safe working environment
While the Company steadily expands its operations, it is cognisant that the health and safety of its employees is fundamental, both for their welfare and to the reputation and performance of the Company. This continues to be a significant area of focus as it strives for continuous operational efficiency. In the recent few years, JSW Steel has implemented a number of initiatives to improve the health and safety conditions for its employees, and has been awarded the Workplace Wellbeing Charter. One such initiative is the linking of the safety performance with the variable pay of the senior management, thereby motivating all employees to enhance their safety performance.
Training on safety
With the aim of ensuring that all individuals have the right knowledge regarding safety procedures that need to be followed in the plants, exhaustive safety training modules have been created. These modules cover different safety standards streamlined into training methodologies that were identified based on specific job requirements and trainings were imparted accordingly.
The training plan covers 14 safety modules. After the risk-based safety training programme is conducted, a safety standard handbook is provided to line managers for better implementation of safety standards. Further, monthly safety campaigns on various themes such as work at height, road safety and electrical safety are conducted to promote awareness.
Vijayanagar Action Centre
The Vijayanagar Action Centre, under the banner of Karnataka Chapter of the National Safety Council, was established in the year 2000, with an ambition to drive safety systems among the surrounding industries of Bellary – Koppal area – and contribute as part of the Company’s CSR initiatives.
The Vijayanagar Action Centre carries out the following activities to create safety awareness and improve the safety systems:
DuPont safety system implementation
In line with the Company’s commitment to provide a safe and healthy work environment, JSW Salem Works has adopted the DuPont Process Safety Management System. The initiative is a part of its safety excellence journey to transform the safety culture of the organisation from a reactive to an interdependent system. The implementation of safety standards and their review structures include various committees such as the Apex Safety Committee, sub-committees, and divisional implementation committees and area implementation committees.
Key areas of focus in the adoption include safety observation, incident investigation, permit to work, confined space, work at height, Lock Out Tag Out (LOTO), road safety, electrical safety, conveyor safety, scaffolding safety, machine guarding, PPE, lifting of heavy equipment and contractor safety management.
Achieving operating excellence through operational discipline
Key performance indicators