Indian Metals & Ferro Alloys Ltd (IMFA), a leading ferrochrome producer, has put in place nearly ₹2000 crore expansion plan, that include greenfield capacity expansion, ramping up chromite ore — a key feedstock for stainless steel making — mining and a foray into ethanol production.
Capital expenditure (capex) will be primarily from internal accruals, and some through a mix of debt, mostly term loans. However, under no circumstance would the debt-to-equity ratio cross the 0.5 per cent “upper cap”, Subhrakant Panda, Managing Director, IMFA, told businessline.
IMFA continues to be a long term net debt free company.
The cornerstone of IMFA’s capex is a ₹900 crore greenfield expansion at its Kalinganagar facility in Odisha which includes the commissioning of two new furnaces with a combined capacity of 1,00,000 tonnes. These projects are expected to be completed by 2026.
Of the two, the first furnace is slated for completion by June 2026 and the second one “some two to three months after that”. This project also features a waste heat recovery power plant to enhance operational efficiency.
Panda said that around ₹150–200 crore of this capex has already been deployed, with the remainder to be rolled out over the coming months. The Kalinganagar capex, part of this broader initiative, is expected to conclude by June 2026.
IMFA is also keeping an eye on international opportunities — for chromite ore — and also India’s critical mineral blocks leveraging its mining and processing expertise. The company will, however, prefer to steer clear of high-cost regions due to logistical and electricity cost concerns.
Bolstering mining operations
Simultaneously, IMFA is also investing over ₹1,000 crore to bolster mining operations, aiming to scale its capacity to 9 lakh tonnes by the end of 2026, with a further increase to 12 lakh tonnes in Phase-II of the project.
This investment, spread over four to five years, underscores “IMFA’s commitment to securing raw material supply chains to support its core ferro-alloys business.”
The current production target (for FY26) from its Sukinda and Mahagiri mines is 8 lakh tonnes and the FY25 production was around 7 lakh tonnes.
“We remain confident of improving demand for stainless steel in India and in line with demand projections, we are looking at a capacity ramp up of our mines,” Panda said.
Ethanol Production
Adding a new dimension to its portfolio, IMFA is venturing into ethanol production with a ₹160 crore investment in a 120 KLD (kilo litres per day) plant at its older unit in Therubali, Odisha. The plant is set to be operational by Q1 2026 (Jan – Mar).
Panda said, this is as a value-accretive B2B business and “leverages existing infrastructure” and complements the company’s core strengths “without diverting focus from ferroalloys”. This strategic diversification aligns with the company’s expertise in processing and resource utilization.
Global Outlook
For the June quarter, IMFA’s ferro chrome production and sales stood at 65,929 tonnes and 66,580 tonnes respectively. Nearly 90 – 95 per cent of its existing sales is in exports.
In Q1FY26, the company had revenue of ₹641.54 crore and a PAT of ₹92 crore.
“Ferro chrome prices picked up during the first quarter of FY26 reflecting a trend reversal and, combined with steady operations sharply focused on efficiency and cost control, led to an improved financial performance,” he said. Prices were up by approximately ₹10,000 per tonne, over Q4FY25 exit prices. July trends indicate further firming up of prices by 3–3.5 per cent with early indications being that Q2 prices could be better.
According to Panda, with reciprocal tariff related uncertainty starting to settle down, a positive impact on global trade is expected, especially if inflation continues to remain relatively muted. The shift toward domestic markets through the Kalinganagar expansion is expected to diversify revenue streams and reduce exposure to global volatility.