Hyderabad’s Jai Raj Ispat Thrives In A Volatile Indian Steel Mkt

I am predicting that 2 years down the line, the company’s revenue will reach a minimum of Rs5,000 crore. For the first time I have taken a term loan of Rs1,000 cr to set up the Kurnool plant, which cost us about Rs2,000 cr. After the Kurnool plant is stabilized I will definitely consider IPO route -- SK Goenka, Founder& MD, Jai Raj Ispat Ltd

Hyderabad: A 30-year-old man from Kolkata relocated to Hyderabad in early 1980s with an Honours degree in Commerce from University of Calcutta and experience of working in his family-owned businesses. SK Goenka found Hyderabad peaceful and affordable to grow his roots here. He established Jai Raj Ispat Ltd in 1985 to mark his entry into the steel business in the South. The MSME commissioned its first ingot manufacturing unit here at Jeedimetla in November 1985.

In 1997, Jai Raj Ispat became the first manufacturer of TMT rebars in Hyderabad. In 2000, they became the first company to make TMT rebars using induction furnace and continuous caster. Jai Raj Ispat commissioned a sponge iron/DRI unit located on 150 acres, in Bellary, Karnataka, with an investment of Rs60 crore, in 2008.

Last year, the company commissioned a TMT rebars manufacturing facility at Orvakal Mega Industrial Hub in Kurnool, Andhra Pradesh. Out of the 430 acres allotted by the government, the unit is set up on 150 acres with a total production capacity of 4.5 lakh tonne. The company has additional 600 acres reserved there for expanding in future.

Speaking with Bizz Buzz, SK Goenka, Founder and Managing Director, Jai Raj Ispat Ltd, said: “I found out that the land rate was very affordable in Hyderabad, and there was no power cut. The city was very peaceful too. So, I went ahead and bought two acres of land from the government at a rate of Rs40 per sq yd. The first unit was set up with an initial investment outlay of a little over Rs1 crore. Back then we sold ingots to CTT bar manufacturers.”

Goenka’s daughter Rajshree Jain, who holds the position of Financial Strategist & Asset Management Director, informed that Jai Raj Ispat was the first MSME in Hyderabad to put up three induction furnaces.

“From initial production capacity of 20,000 tonne of billets, we now produce one lakh tonne of billets and one lakh tonne of TMT rebars annually. From 100 employees we have now grown to a total workforce of 1,950, wherein 600 people are employed in Hyderabad, 150 at Bellary DRI unit and over 1,200 at Kurnool facility.”

In the last financial year, the company clocked revenue of Rs950 crore and is eyeing Rs3,000 crore in FY26, with the Kurnool plant operational.

Speaking on the targeted growth, Siddharth Jain, Executive Director, Jai Raj Ispat Ltd, said: “From the last 5-6 years we have been growing at 10 per cent, as a result of improving efficiency at existing capacity not by adding new apex. Any further growth will come with capacity addition and that will take more than three years. Right now, through Kurnool plant we are ready to enter other South markets and target infra projects.”

Jain informed that they currently serve 80 per cent of individual homeowners and 20 per cent of developers through a network of 15 dealers and 150 sub-dealers located in and around Hyderabad. The TMT rebars manufactured at Kurnool plant will be introduced in the AP market through one exclusive dealer and 300 sub-dealers. In the next 3-4 months, the company will have a total of 1,000 dealer network for entering new geographies, starting with Tamil Nadu, followed by Maharashtra, Karnataka and Kerala.

“Jai Raj Ispat posted Rs15–20 lakh in first FYs revenue. Now, I am predicting that two years down the line the company’s revenue will reach a minimum of Rs5,000 crore. For the first time I have taken a term loan of Rs1,000 crore to set up the Kurnool plant, which cost us about Rs2,000 crore. After the Kurnool plant is stabilized I will definitely consider IPO route,” Goenka said concluding the interview.