- 12 Sep 2022
- ICICIdirect Research
Rail Ministry floats Rs 1000-crore tender for manufacture of forged wheels domestically
News: As per media sources , the Railway Ministry has floated a Rs 1000-crore tender for the manufacture of forged wheels in the country . India requires around 2 lakh forged wheels annually and the bidders who participate in the tender will be given offtake assurances. This is the first time that the Indian Railways has floated a tender to invite private players to build a wheel plant and make wheels for high speed trains. The next step is to invite bids for setting up a plant to manufacture high speed railway tracks also. The tender for manufacture of high speed rails will also be floated in a few weeks and only domestic steel companies and railway wheel factories will be allowed to participate in this current tender. Around 80,000 forged wheels will need to be manufactured annually under the floated tender.
View: Among domestic steel companies, SAIL has a capacity to produce more than 70,000 forged wheels per year. Rashtriya Ispat Nigam (RINL), another PSU, has a plant with a production capacity of one lakh pieces of forged wheels annually. In May this year, Jindal Steel and Power (JSPL) said it will be setting up India’s first private sector Rail Wheelset manufacturing plant at its Raigarh facility in Chhattisgarh. A company statement had said that JSPL has collaborated with GIFLO Steel - Hungary for this project. With regard to this tender, the successful bidder will have to set up the rail wheel manufacturing plant. It is estimated that Rs 1000 crore investment is needed for the project. The wheels manufactured under this tender will also be export oriented with a focus on European markets. This is a good opportunity for steel companies.