Ramkrishna Titagarh Rail's Rs 2,180 Cr Forged Wheels Project Nears Closure
Jul 19, 2024 11:54
Ramkrishna Titagarh Rail Wheels Ltd (RTRWL) is nearing financial closure for its Rs 2,180-crore forged wheels project in Chennai. The project, a joint venture between Ramkrishna Forgings Ltd and Titagarh Rail Systems Ltd, will initially house an installed capacity of 228,000 wheels per annum.
Kolkata, Jul 19 (PTI) Ramkrishna Titagarh Rail Wheels Ltd (RTRWL), a joint venture between city-based Ramkrishna Forgings Ltd and Titagarh Rail Systems Ltd, is nearing financial closure for its Rs 2,180-crore forged wheels project, a top company official said.
Financial closure for a project financing is the stage where all conditions of a financing agreement are met, and the availability of funds becomes imminent.
"The project is progressing well. The company has secured statutory clearances and is in the final stages of achieving financial closure," RTRWL board member and Titagarh Rail's Deputy Managing Director Prithish Chowdhary told PTI.
RTRWL's greenfield manufacturing facility, located in Chennai, is set to initially house an installed capacity of 228,000 wheels per annum.
"The project will be executed in two phases - Phase I, costing Rs 1,810 crore and Phase II (Rs 370 crore). Funding will come from a combination of debt and equity in a 70:30 ratio," Chaitanya Jalan, whole-time director of Ramkrishna Forgings, said.
RTRWL, a 51:49 JV, plans to secure around Rs 1,530 crore in debt, having received a stable rating from Ind Ra for its term loan. Equity capital totaling Rs 650 crore will be infused progressively based on the shareholding of the parent companies as construction advances, company officials said.
Phase I operations are scheduled to commence from April 2026 with an installed capacity of 114,000 wheels per annum. Phase II will add another 114,000 wheels per annum and begin operations by 2028-29.
"The company will initially prioritise fulfilling the requirements of Indian Railways as per the wheel supply agreement programme, with the remainder addressing demand from private players in both domestic and export markets," Jalan said.
Under an agreement with the Ministry of Railways, RTRWL will supply forged rail wheels - up to 80,000 wheels per annum (35 per cent of installed capacity) - over 20 years as part of the 'Atmanirbhar Bharat' initiative.
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